The Chairman of the State Securities Commission (SSC), Vu Bang, has confirmed his agency would not adjust stock trading bands, refuting rumours that the regulator would narrow the bands to cushion the recent stock market plunge.

Vietnam's stocks recorded the biggest one-day drop since 2001 on May 8. The VN-Index on the Hochiminh Stock Exchange tumbled nearly 33 points to a 13-year low of 527.09 while the HNX-Index on the Hanoi bourse lost five points, ending at 71.66.

"If the commission is to adjust the bands every time stock indices fall steeply, it will no longer be a free market but one guided by the invisible hand of State intervention. In fact, it's normal for the market to rise or fall and the SSC will not adjust trading bands at this time," Bang was quoted as saying by the the Thoi bao Kinh te Sai Gon (The Saigon Times) newspaper.

He said it was not easy to predict market developments during this time, but investors should stay calm and avoid making rash and wrong decisions.

"Foreign investors are still buying and there are no signs that they will withdraw capital from the market. So local investors should not worry too much," Bang said.

However, he did not rule out the possibility of intervention in certain unavoidable scenarios.

In a press release on May 7, the SSC said Vietnam's macroeconomic condition was still stable with some positive data emerging: The number of profit-making companies was on the rise and that of loss-making ones declining; foreign indirect investment inflow in the first quarter was nearly doubled the same period last year.

Most international organisations have made positive assessments of the nation's economic recovery, it noted.

Meanwhile, the commission pledged to monitor unusual transactions and issue strict penalties on any manipulative action in the market.

In contrast to local investors' moves on May 8, foreign investors concluded the session as net buyers on both stock exchanges, picking up nearly 10 million shares worth a combined 279 billion VND (13.2 million USD).

The market soon advanced on May 9, earning back about half of previous day’s loss, thanks to the participation of bottom-fishing capital, especially the net purchases of foreign investors and large institutional investors, coupled with the State Securities Commission's effort to calm the market.

The VN-Index on the Hochiminh Stock Exchange dropped 6.14 percent over the previous week, to end at 542.46 points, while the HNX-Index on the northern bourse closed 7.13 percent lower at 74.19 points.-VNA