Vietnam’s shares extend two-day drop

Illustrative image (Source: VNA)

Hanoi (VNA) - Vietnamese shares on January 5 extended losses on both local markets for a second day as investors remained cautious amid volatility in Chinese stock markets.

The benchmark VN Index on the HCM Stock Exchange dropped 0.8 percent to close at 569.94 points. The southern index has fallen 1.6 percent during the last three days.

The VN Index lost 1.3 percent to finish at 78.43 points. The northern index has declined by 1.9 percent in two days.

"Investors remained cautious after Chinese stocks fell sharply and shut down on Monday," Sai Gon Hanoi Securities Corporation (SHS) wrote in a report.

Chinese shares fell 7 percent on January 4 and dropped further on the following day.

Vietnam authorities should watch closely moves made by China in its economy and currency in order to minimise their negative impact on Vietnam's foreign exchange rate and stock market, Vu Bang, Chairman of the State Securities Commission, told Vietnam News Agency.

The reference point for the official inter-bank foreign exchange rate set by the Vietnam's central bank was 21,907 VND a US dollar on January 5, an increase of VND11 from a day ago.

The financial industry led the market decline as the banking sector index lost 1.2 percent, the insurance sector index fell 1.8 percent and the brokerage sector index dropped 2.7 percent.

The banking sector was driven down by Vietcombank (VCB), which declined by 1.6 percent, Vietinbank (CTG), which dropped 1.1 percent, and Sacombank (STB), which lost 2.4 percent.

Insurer Bao Viet Holdings (BVH), and brokerage Sai Gon Securities Incorporate (SSI) and HCM Securities Corporation (HCM) pulled their sectors down. BVH lost 1.9 percent, SSI fell 3.7 percent and HCM dropped 1.7 percent.

Oil prices made gains in global markets. The US benchmark crude West Texas Intermediate (WTI) was up 0.8 percent to trade at 37.04 USD a barrel.

However, local energy stocks suffered as WTI crude price fell 0.8 percent on January 4. PetroVietnam Gas Corporation (GAS) dropped 0.3 percent, and PetroVietnam Drilling and Well Services Corporation (PVD) fell 4.9 percent.

Both local markets traded nearly 148 million shares worth 2 trillion VND (89.2 million USD), a decrease of 14.2 percent from the opening day of 2016.-VNA