Illustrative image (Source: tinnhanhchungkhoan.vn)
 

Hanoi (VNA) - Shares unexpectedly edged down on January 18 despite a positive morning performance as leading bank stocks lost steam on cautious sentiments ahead of the Tet (Lunar New Year) holidays which start next week.

The benchmark VN-Index on the HCM Stock Exchange decreased 0.2 percent to close at 683.3 points. It had risen 1 percent on January 17.

On the Hanoi Stock Exchange, the HNX Index went down 0.8 percent to end at 83.3 points, lifting the two-day loss to 1.3 percent.

Banks, which provided January 17’s momentum, slumped despite optimistic forecasts for the industry by experts after Prime Minister Nguyen Xuan Phuc revealed the Government’s plan for raising the cap on foreign ownership limits in commercial banks this year.

Surprisingly, the four largest banks by market capitalisation and liquidity on the HCM City’s bourse, Vietcombank (VCB), Vietinbank (CTG), BIDV (BID) and Military Bank (MBB), lost between 1-2 percent of their value.

Smaller banks like Sai Gon-Hanoi Bank (SHB) and Nam Viet Bank (NVB) on the Hanoi exchange dropped 2.1 percent and 8.7 percent, respectively.

Only two maintained their rise in value: Eximbank (EIB) and Sacombank (STB), with gains of 1 percent and 2.3 percent, respectively.

Allowing greater foreign ownership of banks has generally been seen as a positive step forward, speeding up the country’s ascent to emerging-market status.

According to analysts at Artex Securities Co, decreases in exposure by investors could be attributed to risk-averse sentiments when a long holiday is round the corner. Slowing down trading could reduce financial costs, especially cost of borrowings to buy stocks.

“This is a periodical phenomenon and its influence depends on market and economic conditions,” the analysts wrote.

The VN-Index and leading stocks have risen strongly since October 2016 and will likely enter a downward correction, they said, predicting another one or two declining sessions before a rebound.

Overall, the market condition was negative with 249 losing stocks, 158 risers and 297 closing flat.

Liquidity decreased with a total of 126 stocks worth a combined 2.5 trillion VND (110.6 million USD) traded in the two markets, down 3.8 percent in volume and 7.4 percent in value, respectively.

Foreign investors continued net selling for a value of 15 billion VND on the two exchanges. They were responsible for a 26 billion VND net sell value on January 17.-VNA