Vietnam’s benchmark VN-Index sank by 5.5% to close at 1,636.43 on Monday, marking its lowest finish in a month and the sharpest slide in half a year. The sell-off was triggered by fresh anxieties over corporate bond issuance infractions, following the release of a regulatory inspection into 67 bond issuers, including several major banks.
Trading volumes surged as over 1.7 billion shares worth 53 trillion dong ($2.01 billion) changed hands on the Ho Chi Minh Stock Exchange during the session. The rout was broad-based, with significant declines across sectors. Leading decliners included SSI Securities, steel producer Hoa Phat, and Saigon Thuong Tin Bank, all reported a decline of nearly 7%.
Blue-chip firms such as Vingroup (-4.46%), Vinhomes (-6.90%), and Bank for Foreign Trade of Vietnam (-4.04%) also weighed heavily on the index. According to local media, the Government Inspectorate’s report identified numerous violations such as improper use of bond proceeds, insufficient disclosures, weak capital control, delays in principal and interest payments, and premature project liquidations.
Investor sentiment soured noticeably after the report’s disclosure with a sharp drop in the afternoon session. Further exacerbating the downturn, Novaland Investment Group revealed it was unable to fulfill obligations on its convertible bonds, adding to the market’s jitters.
Marco Martinelli, partner at Turicum Investment Management, noted the prior months’ robust rally had spurred retail investors to take on greater leverage, leaving the market exposed to forced liquidations amid adverse news.
