Vietnam stocks at 16-mth low, down 7th day in a row

Vietnam shares fell for the seventh session in a row and closed at a 16-month low on Monday as recent government plans to buy stocks failed to boost investor confidence.
Traders said a plan announced on March 6 by the state investment arm, the State Capital Investment Corp, to buy shares, had made little difference to the fledgling $14.6 billion exchange. Few details were disclosed about the plan.
A liquidity crunch in recent months partly created by central bank monetary tightening policies to tame double-digit inflation has hit markets.
"The market is in desperate need for good news to regain investors' confidence but there isn't any," a Hanoi-based stock market analyst said. "Government measures seem to have little lasting impact."
The Ho Chi Minh Stock Exchange lost 4.5 percent to close at 521.07 points, the lowest since Nov. 7, 2006, the month Vietnam won approval to join the World Trade Organization.
The index has fallen 20 percent in seven sessions. The Vietnam index is down 44 percent this year, making it the worst performing index in Asia.
The over-the-counter Hanoi Securities Trading Center fell 7 percent to 178.6 points on Monday.
"Relief for stocks will come when the government curbs its penchant for monetary tightening and modernises Vietnamese dong policy with market mechanisms such as a trade-weighted basket or managed float," Ho Chi Minh City-based Dragon Capital fund said in its latest monthly report.
On March 10, the State Bank of Vietnam widened the trading band of the heavily-managed currency to +/-1 percent of the official rate from +/-0.75 percent, one of a series of moves aimed at tackling inflation.
Vietnamese media reports have quoted central bank officials as saying the bank was mulling widening the band further, without specifying a time frame.
On Monday, trading volume on the Ho Chi Minh Stock Exchange fell to 10 million shares from 14.5 million shares on Friday.
Shares in a number of companies lost 5 percent, the maximum allowed by regulators, including Petrovietnam Fertilizer and Chemicals Co and Sacombank .
When the index was last trading at these levels in November 2006, there were fewer than 50 listings compared with 150 now.
A wave of listings and enthusiasm for capital markets development in late 2006 and early 2007 lifted shares to a life-high of 1,170.67 on March 12 last year.