Stocks failed to sustain morning gains, with the benchmark VN-Index falling 0.26 percent to close the session at 591.5 points on July 1.

Blue chips were mixed. The VN30, which tracks the top 30 shares by market value and liquidity on the HCM Stock Exchange, inched up just 0.08 percent to end at 622.91 points.

Bank stocks led the downturn here as most of large-cap lenders posted losses.

Vietinbank (CTG) was the biggest loser, down 3.65 percent, followed by Vietcombank (VCB) with a decrease of 3.07 percent. VCB is the biggest stock in term of market capitalisation so its slump substantially weighed down the southern market.

Other banks like Military Bank (MBB), Eximbank (EIB) and BIDV (BID) also dropped 1.5 to 2 percent.

"Many investors decided to take margins when the market approached the sentimental threshold of 600 points," analysts at FPT Securities Co wrote in a report on the company's website on July 1.

Overall liquidity declined from June 30 with the market volume being down 10 percent to reach 133.3 million shares while value of trades declined 20 percent to over 2.2 trillion VND (101 million USD).

Property developer FLC Group (FLC) continued to top the market with a whopping trade of 11.5 million shares, closing flat at 8,600 VND a share.

On the Hanoi Stock Exchange, the HNX-Index managed a gain of 0.36 percent to finish at 85.25 points on July 1 thanks to rallies of blue chips.

Members of the HNX30, which includes the 30 biggest stocks in terms of market value and liquidity in the Hanoi market such as Asia Commercial Bank (ACB), PetroVietnam Technical Services (PVS) and construction giant Vinaconex (VCG), boosted the market.

However, trading slowed down as both market volume and value decreased 30 percent from June 30, totalling more than 40 million shares worth 511.2 billion VND (23.4 million USD).

F.I.T Investment Co (FIT) remained the most active code with 3.5 million shares, closing 1.6 percent lower at 12,600 VND each.

Foreign investors continued to buy shares in the two markets, but their net buy values were tiny at just nearly 23 billion VND (1.1 million USD) on July 1, down substantially compared with a net buy of 457 billion VND (21 million USD) seen on June 30.-VNA