South East Asian markets: Thai index down; Vietnam index marks biggest jump in three weeks

Southeast Asian stock markets fell on Wednesday, with the Thai index hitting a more than seven-month low and Singapore drifting into negative territory, as investors lowered risk holdings in a reporting season amid weak sentiment in Asia. The SET index was down 0.1 percent at 1,445.37, after having fallen to 1,432.58, its lowest since December 16.
It had lost almost 3 percent in six successive days to Tuesday amid selloff in banking shares on concerns over the impact of weak economy on loan books while construction shares fell on expectations of possible delays in government projects. The weak sentiment has been due to a combination of poor economic data, banks' warning on asset quality, impact of drought, the downgrade of exports and expectations of a cabinet reshuffle, analyst at SCB Securities said.
The broker advised 'buy' for a market rebound as many stocks were oversold, its report said. "The dismissal by the Prime Minister of expected government reshuffle has acted as the last straw ... We were expecting a change in the economic advisory team to bring in advisors which would resume subsidies or stimulus of some form," they said. Singapore's key index edged down 0.4 percent, with Capitaland Mall Trust 1.8 percent lower. The Jakarta composite index was virtually flat on resuming trading, Malaysia's key index retreated from a more than six-week closing high on Tuesday and the Philippines reversed from Tuesday's close of a near four-week high.
Vietnam's benchmark VN Index made the biggest jump in nearly three weeks, closing up 2.15 percent on Wednesday, with gains in banking shares providing support amid positive economic growth forecasts and corporate earnings. The index climb is the highest since July 2, when the market ended up 2.4 percent, based on Reuters data. Hanoi-based Vietcombank, Vietnam's top firm by market value, closed up 5.69 percent. BIDV, the nation's biggest partly private lender by assets, rose 5.6 percent and VietinBank advanced 3.6 percent. "The market will follow an upward trend in the long-term, thanks to the support of both positive economic indices and the government's liberal regulations", said Nguyen The Minh, a manager at Viet Capital Securities. The government said late last month it would lift the foreign ownership cap from many listed firms as of September 1.
On Monday, the World Bank raised its forecast for Vietnam's economic growth this year to 6.0-6.2 percent from 6 percent, citing robust private consumption and investment. Shares of property companies also rose, including Vingroup that rallied 3.49 percent. Traders expect the index to climb further to 640 points in the next few sessions. Vietnam's securities market is outperforming the rest of Southeast Asia with a 15.4 percent growth while its shares are the second-cheapest in the area, after Singapore.