On August 6, the VN-Index rose 26.56 points (+1.72%) to reach a new historic high of 1,573.71. Just one day earlier, it had climbed nearly 19 points to 1,547.15. Trading liquidity hit a record level with over VND 85.7 trillion (approx. USD 3.3 billion) exchanged across all three exchanges.

Since early April, the VN-Index has surged from around 1,100 points to its current level, marking a staggering 43% gain. The bullish trend has attracted both seasoned and new investors, amplified by aggressive support from securities firms and financial institutions.

However, the rapid rise of several stocks, many with unchanged or weak financial fundamentals, has sparked concerns about speculative bubbles. Some investors are chasing quick profits through high-risk trades, unaware of the real value of the businesses behind the stocks.

A notable past example is the ROS stock, which skyrocketed to over VND 180,000 per share in 2017, placing it among the largest market-cap stocks on the HoSE. Later, when it was discovered to be involved in manipulation and artificial price inflation, it plummeted to under VND 5,000, leaving many retail investors with devastating losses.

Similarly, PV Gas’s GAS stock surged during market optimism but suffered sharp declines as natural gas prices fell and business performance worsened. Investors who acted on hype rather than sound analysis paid the price with heavy losses.

When the market overheats, crowd psychology and unverified rumors can dominate trading behavior. Stocks manipulated through fake supply-demand mechanisms give the illusion of growth. Retail investors who join the game too late often bear the brunt of the fallout.

Regulatory oversight intensified

Amid this explosive market activity and growing risk, the SSC announced it will tighten surveillance, inspection, and enforcement against violations. It instructed stock exchanges, the Vietnam Securities Depository and Clearing Corporation (VSDC), and brokerage firms to reinforce monitoring to ensure a safe and stable market.

Exchanges must closely monitor abnormal fluctuations in stock prices. If signs of manipulation or irregular trading are found, they are required to analyze, assess, and recommend action, reporting directly to the SSC for resolution under existing regulations.

Brokerage firms have also been ordered to strictly comply with securities laws, enhance oversight of employees, and prevent unlawful promotion or investment advice through online forums or social media groups.

Furthermore, brokerages must ensure their clients - both individuals and institutions - adhere to legal trading practices. If suspicious trades are detected, firms must promptly report them to the SSC for appropriate action.

Manh Ha