Shares rebounded yesterday on both national stock exchanges after three days of heavy losses following the arrests of two banking tycoons. Trading value on both exchanges totalled VND1.8 trillion (US$85.7 million), up 80 per cent over a day earlier.

The benchmark VN-Index on the HCM City Stock Exchange regained nearly 7 points, or 1.76 per cent, to close at 399.72 points on a total value of more than VND1.2 trillion (US$57.1 million).

Blue chips boosted the market, with most bank shares recovering losses from the past three days.

Military Bank (MBB) hit the ceiling price while Vietcombank (VCB), Sacombank (STB) and Vietinbank (CTG) all rose from 2-4 per cent. Only Eximbank (EIB) was off 1.7 per cent.

Other large-cap shares also jumped, with Phu My Fertiliser (DPM), dairy giant Vinamilk (VNM) and steelmaker Hoa Phat Group (HPG) up from 2-4.8 per cent.

The VN30 Index was also up 1.7 per cent at 472.75 points.

Tan Tao Investment Industry Corp (ITA) continued to be the most active code by the end of yesterday with almost 5.8 million shares changing hands, closely followed by Eximbank (EIB) with 5.55 million shares. But while ITA was up 3.5 per cent to VND6,000 ($0.29) a share, EIB closed 1.7 per cent off at VND17,700 ($0.84) a share.

The detention of bank tycoons Nguyen Duc Kien and Ly Xuan Hai had caused the hefty fall in the securities market and these concerns may continue in a short term, said Andy Ho, managing director and head of investment at VinaCapital.

"However, as a long-term investor, we believe that the basic elements of other blue chips in Viet Nam's market will not be affected and investment opportunities will appear in the current downtrend."

On the Ha Noi Stock Exchange, the HNX-Index also edged up 3.07 per cent to finish at 63.11 points on a total turnover of VND591.5 billion ($28.2 million).

Advancers overwhelmed decliners by 130-93 with bank shares rising.

Sai Gon-Ha Noi Bank (SHB) increased 6.2 per cent while Asia Commercial Bank (ACB) regained 3.3 per cent after three sessions of hitting the floor price. Small banks such as Nam Viet Bank (NVB) also rose 1.3 per cent.

Other leading shares such as Kim Long Securities (KLS), VNDirect Securities (VND) and PetroVietnam Construction (PVX) also gained value, with the latter being the most active on trades of nearly 9.3 million shares. PVX closed up 1.4 per cent at VND7,000 a share.

According to Bloomberg, Viet Nam's stock market approached a bear market this week after the arrest. Shares lost 18 per cent from their peak on May 8, recording the heaviest fall in Asia in the past month in the context that shares in most other Asian markets rose strongly.
Overseas investors continued to buy Vietnamese shares. Their net buys totalled $15 million worth of shares during the past four days.