Hanoi - Vietnam's stock market hit its lowest mark in nearly three years Monday as the country's economic outlook worsened. The VN-Index today closed down 1.03 points, or 0.32 percent, at 317.9, the lowest level since February 2006.
"Local traders don't want to buy at this time as they see the global market continue to fall," said Phan Hong Quan, director of Eurocapital Securities in Hanoi. "They favour holding cash, waiting for signs that the market is rebounding."
Quan said Vietnam's macroeconomy had improved a little bit, but there are still many uncertainties including the risk of inflation.
Last month, the government reported inflation was running at 23.1 per cent in Vietnam, one of the highest rates in Asia.
"I don't think the market can rebound in this year," Quan said.
Vietnam's economy largely depends upon on exports, but the final quarter of 2008 will be a difficult time for export companies as their markets have shrunk. Foreign companies are already reporting they are cutting back orders, fearing smaller demand back home.
"I don't find any factors strong enough to help the market rebound until next March," said Vo Quoc Khanh, former director of Investment and Analysis at FPT Securities Company.
One local trader said he had lost his patience and was getting out of the market. "Despite a big loss," said Nguyen Nam Phuong of Alpha Securities, "I decided to sell all my stock today."
Since the beginning of November, Vietnam's stock market has lost about 9 per cent.
