Visitors at Hue Citadel, Thua Thien-Hue province. The COVID-19 pandemic has caused severe damage to Vietnam's tourism sector and sent investment funds' performance down in February. (Photo: VNA) Hanoi (VNS/VNA) - Latest reports from investment funds in Februaryshow they have suffered from the decline of the market amid the global spread ofthe COVID-19.
The benchmark VN-Index on the Ho Chi Minh Stock Exchange has lost a total of23.1 percent between January 30 and March 14 when the stock market re-openedafter the Tet (Lunar New Year) holiday.
The tumble of the Vietnamese stock benchmark concurs with the strong selling offoreign investors, which has reached a total net value of nearly 4.73 trillion VND(203.6 million USD) during the period.
In February, the VN-Index was down a total of 5.81 percent and foreigninvestors net-sold a total of 3.15 trillion (VND).
Worries about COVID-19 and its impact on the global economy and people’shealth, and late responses of governments triggered a large-scale sell-offaround global markets and pushed indices down.
Investment funds have seen their net asset value (NAV) fall sharply during thetime.
The Finland-based PYN Elite Fund announced its February performance fell 2.72 percenton a monthly basis, recording the worst February performance since 2011.
The Hong Kong-based AFC Vietnam Fund recorded a loss of 3.9 percent in Februaryperformance. The Swedish fund Tundra Vietnam Fund saw its portfolio value drop3.1 percent last month, raising the total loss to 7.8 percent in the first twomonths of the year.
The poor performance was attributed to the strong decline of investees thataccount for a large proportion of the fund’s portfolio such as the Ho Chi MinhCity Infrastructure Investment JSC (CII), the Vietnam Engine and AgriculturalMachinery Corporation (VEA) and Mobile World Investment Corp (MWG).
Travelling and immigration restrictions have brought some damage to localindustries such as aviation, tourism, energy and exporting agriculture,according to PYN Elite Fund.
In the January-February period, Vietnam’s agriculture exports fell 4.3 percentto 2.5 billion USD. The local Manufacturing Purchasing Managers’ Index (PMI)dropped to 49 in February from 50.6 in January as orders declined andproduction costs went up due to the disruption of the global supply chain.
Despite being surrounded by difficulties, foreign funds are still optimisticabout the future prospects of the local assets.
AFC Vietnam Fund said in a report the pandemic will cause damage to the globalstock markets in one or two quarters and the worst-hit sectors are likelytourism and hospitality.
But losses will be covered quickly in the second six-month period of the yearas Vietnamese shares are now cheaper than they were at the beginning of theyear.
Vietnam’s economic growth is forecast at 6.0 percent in 2020, down from 7.02 percentmade in 2019. But the growth will still be stronger than some others, the fundsaid.
The Government will have policies to support the hard-hit sectors such astourism and manufacturing, which contributed 12-20 percent of the total GDP in2019, and restrain the damage caused by the pandemic.
The moving of factories from China will help raise Vietnam’s GDP growth byadditional 2 percent and the ratification of the Europe-Vietnam Free TradeAgreement (EVFTA) will boost Vietnam’s exports to the European markets by 42.7 percentin the next five years./.
VNA
