Blue chips hit by low confidence hinh anh 1Hoang Anh Gia Lai’s largest cattle farm in Gia Lai Province. The firm’s shares on Monday fell sharply after the company reported a loss of 1.1 trillion VND for 2016. (Photo: VNA)

Hanoi (VNA) - Shares dropped on both local markets on May 8 as investors switched investments from large-cap stocks to mid- and small-cap ones, putting blue chips into negative territory.

The benchmark VN Index on the HCM Stock Exchange inched down 0.16 percent to close at 718.86 points. Vietnam’s key index has lost total 0.4 percent after the last two sessions.

The HNX Index on the Hanoi Stock Exchange fell 0.65 percent to end at 89.13 points, retreating from a gain of 0.2 percent made on Friday.

Market trading liquidity improved from the previous session. More than 277 million shares were traded on both local bourses, worth 5.85 trillion VND (260.2 million USD).

Low investor confidence sent large-cap stocks down with two-thirds of the largest 30 companies by market capitalisation falling.

Among the 10 largest listed firms, FLC Faros Construction (ROS) lost 0.9 percent, dairy producer Vinamilk (VNM) was down 0.5 percent, and Vietcombank (VCB) decreased by 1 percent.

Other large-cap stocks that declined were Tien Phong Plastic (NTP), Asia Commercial Bank (ACB) and Saigon-Hanoi Bank (SHB), which slid between 1.1 percent and 4.1 percent.

The two largest agriculture and farming companies, Hoang Anh Gia Lai (HAG) and its subsidiary Hoang Anh Gia Lai Agriculture International (HNG) dipped 6.6 percent and 6.8 percent, respectively.

The stocks of both companies were put on the designated list and the decision will come into effect on May 12 as the two firms have reported a loss of 1.1 trillion VND for Hoang Anh Gia Lai and 984.8 billion VND for its agriculture arm.

The energy sector finished down on Monday as global oil prices reversed to trade around the reference price levels after remaining positive in the morning.

Brent crude inched up 0.1 percent to trade at 49.15 USD a barrel, erasing the gains made in the earlier half of the day as investors and analysts were kept waiting on hopes for a prolonged output cut agreement between the Organisation of Petroleum Exporting Countries (OPEC) and other large exporters.

On the positive side, mid-cap and small-cap stocks, especially real estate firms’ shares, proved a safe haven for short-term investors.

Shares of property developers became attractive to investors as they were ahead of companies that are about to pay dividends in cash and bright prospects for the domestic real estate market.

The benchmark VN Index fell for a second day as it attempted to test the lower support levels, Saigon-Hanoi Securities (SHS) said in its report.

However, the May 8 fall was not something that investors should worry about as strong demand and purchases for low-valued stocks remained strong, SHS said.

The current conditions suggest that the VN Index would fall back to the range of 715 and 718 points before recovering and approaching the challenging level of 720 points, the northern brokerage firm added.-VNA