boiman
20-08-2008, 05:14 PM
The trading band for both the HCM City Stock Exchange
(HOSE) and the Ha Noi Securities Trading Centre (HASTC) was widened
once again.
The State Securities Commission’s Thursday decision sets HOSE’s new trading band at 5 per cent and HASTC’s at 7.
The trading band represents the amount that listed shares can rise or fall within a single trading day.
The expansion is the ninth trading band adjustment
since the stock market began sessions in 2000. Since, then band
adjustments have served as a barometer for market conditions within the
country.
July 28, 2000: The first time the
trading band was altered, the State Securities Commission tightened it
from the planned 5 per cent to 2 per cent. The new band applied in the
very first trading session of the stock market.
The VN-Index started at 100 points, and after a year with an adjusted 2 per cent band, it rose to 571 points.
June 13, 2001: The commission decided
to widen the band from 2 to 7 per cent, plus or minus. The stock market
saw rapid growth during 6 consecutive sessions. Subsequently, the
VN-Index dropped to a record low of 203 points on October 12, 2001.
October 15, 2001: As a result of
broad panic on the stock market, the trading band was changed a third
time. Securities regulators decided to make a dramatic move by
tightening control over shares, narrowing the band to 2 per cent, plus
or minus, from the previous 7 per cent.
The commission also decided to reduce the tranche of
shares from 100 to 10 and to increase the trading session number to six
days a week, instead of three.
As a result, the VN-Index advanced consistently for 19 sessions, but then began dropping back.
August 1, 2002: The trading band was loosened from 2 to 3 per cent and the VN-Index still declined.
December 23, 2002: The commission
resumed a 5 per cent trading band to encourage more exchanges. The
stock market experienced strong growth during the 2005-2007 period.
March 27, 2008: Impacted by the
fluctuation of both local and global economies, the nation’s stock
market began to suffer. Investors began selling shares en masse,
incurring huge losses. Securities regulators once again intervened in
the market by reducing the band to 1 per cent from 5 per cent on HOSE,
and 2 per cent from 10 per cent on HASTC.
As a result, the VN-Index rose for several sessions. The action prevented share dumping, but liquidity was lost.
April 7, 2008: Due to lack of market
liquidity, an imbalance arose between share supply and demand, so the
commission cautiously loosened the band by one percentage point for
both bourses.
The VN-Index continued its up-trend and then went into a consistent falling pattern, though liquidity improved somewhat.
June 16, 2008: The band was loosened
by one percentage point yet again, as Government efforts toward
stabilising the economy began showing the first signs of success.
Accordingly, shares listed on HOSE were traded at
around 3 per cent of a single day’s preference price, plus or minus. On
HASTC, shares fluctuated within 4 per cent.
The VN-Index fell in 3 consecutive sessions to its
lowest level yet, 368 points, on June 20. After that it rebounded and
continued gradual gains, with the occasional downturn as investors
unloaded shares to turn a profit.
August 18, 2008: Shares listed on HOSE will be traded at around 5 per cent instead of 3, and shares on HASTC at 7 instead of 4.
The change has been viewed as a bold and potentially
reckless step by securities regulators. However, the regulators have
based the change on the increasing stability of local and overseas
economies and greater enthusiasm from investors in securities trading.
(HOSE) and the Ha Noi Securities Trading Centre (HASTC) was widened
once again.
The State Securities Commission’s Thursday decision sets HOSE’s new trading band at 5 per cent and HASTC’s at 7.
The trading band represents the amount that listed shares can rise or fall within a single trading day.
The expansion is the ninth trading band adjustment
since the stock market began sessions in 2000. Since, then band
adjustments have served as a barometer for market conditions within the
country.
July 28, 2000: The first time the
trading band was altered, the State Securities Commission tightened it
from the planned 5 per cent to 2 per cent. The new band applied in the
very first trading session of the stock market.
The VN-Index started at 100 points, and after a year with an adjusted 2 per cent band, it rose to 571 points.
June 13, 2001: The commission decided
to widen the band from 2 to 7 per cent, plus or minus. The stock market
saw rapid growth during 6 consecutive sessions. Subsequently, the
VN-Index dropped to a record low of 203 points on October 12, 2001.
October 15, 2001: As a result of
broad panic on the stock market, the trading band was changed a third
time. Securities regulators decided to make a dramatic move by
tightening control over shares, narrowing the band to 2 per cent, plus
or minus, from the previous 7 per cent.
The commission also decided to reduce the tranche of
shares from 100 to 10 and to increase the trading session number to six
days a week, instead of three.
As a result, the VN-Index advanced consistently for 19 sessions, but then began dropping back.
August 1, 2002: The trading band was loosened from 2 to 3 per cent and the VN-Index still declined.
December 23, 2002: The commission
resumed a 5 per cent trading band to encourage more exchanges. The
stock market experienced strong growth during the 2005-2007 period.
March 27, 2008: Impacted by the
fluctuation of both local and global economies, the nation’s stock
market began to suffer. Investors began selling shares en masse,
incurring huge losses. Securities regulators once again intervened in
the market by reducing the band to 1 per cent from 5 per cent on HOSE,
and 2 per cent from 10 per cent on HASTC.
As a result, the VN-Index rose for several sessions. The action prevented share dumping, but liquidity was lost.
April 7, 2008: Due to lack of market
liquidity, an imbalance arose between share supply and demand, so the
commission cautiously loosened the band by one percentage point for
both bourses.
The VN-Index continued its up-trend and then went into a consistent falling pattern, though liquidity improved somewhat.
June 16, 2008: The band was loosened
by one percentage point yet again, as Government efforts toward
stabilising the economy began showing the first signs of success.
Accordingly, shares listed on HOSE were traded at
around 3 per cent of a single day’s preference price, plus or minus. On
HASTC, shares fluctuated within 4 per cent.
The VN-Index fell in 3 consecutive sessions to its
lowest level yet, 368 points, on June 20. After that it rebounded and
continued gradual gains, with the occasional downturn as investors
unloaded shares to turn a profit.
August 18, 2008: Shares listed on HOSE will be traded at around 5 per cent instead of 3, and shares on HASTC at 7 instead of 4.
The change has been viewed as a bold and potentially
reckless step by securities regulators. However, the regulators have
based the change on the increasing stability of local and overseas
economies and greater enthusiasm from investors in securities trading.