Profit-taking drags stocks down

(Photo: VNA)

Hanoi (VNS/VNA) - Vietnamese shares fell on August 9 as strong selling pressure weighed down large-cap stocks and listed firms suffered from negative news of the macro-economy.

The benchmark VN-Index on the HCM Stock Exchange dropped 0.29 percent to close at 963.50 points, retreating from a nearly one percent increase made on August 8.

The HNX Index on the Hanoi Stock Exchange narrowed its gain form as much as 1.1 percent to 0.12 percent to end the session at 107.80 points. The northern market index has risen total 2.1 percent in the last three days.

More than 207.8 million shares were traded on the two local exchanges, worth 4.9 trillion VND (217 million USD).

The trading figures were up 3.6 percent in volume and 14.6 percent in value compared to August 8.

The decline of the stock market on August 9 was mostly due to the “profit-taking of the investors who invested in the bottom as well as loss cutting of those who invested in the last few months,” BIDV Securities JSC (BSC) said in its daily report.

The three key industries – real estate, energy and banking – were the major factors to weigh down the overall performance of the market.
Those sector indices fell between 0.7 percent and 3.3 percent, data on vietstock.vn showed.

Bank stocks were hit by profit taking. Bank for Investment and Development of Vietnam (BID) dropped 1.2 percent after having made a four-day rally of total 11.4 percent.

Others such as Vietcombank (VCB), Techcombank (TCB) and MBBank (MBB) also ended in negative territory.

Energy stocks headed down following a slump of oil prices on night. Brent crude lost 3.2 percent to finish August 8 at 72.28 USD a barrel.

Among energy stocks that suffered from the drop in oil prices were PetroVietnam Technical Services (PVS), PetroVietnam Coating Corp (PVB), and PetroVietnam Drilling and Well Services (PVD).

Property developers such as Vingroup (VIC), Vincom Retail (VRE), HCM City Infrastructure Investment JSC (CII) and FLC Group (FLC) might be affected by a stronger determination of the State Bank of Vietnam (SBV) to tighten credit growth in the remaining months of the year.

“This is bad news for the stock market as monetary policy orientation of the SBV has been closely correlated with money flows running into the stock market,” Bao Viet Securities JSC (BVSC) said in its report.

On the opposite side, insurance companies, brokerages, information and technology firms, and food and beverage producers were among those that supported the market.

Positive outlook would continue for local stocks in coming sessions as cash flow increased despite the market’s decline, Sai Gon-Hanoi Securities JSC (SHS) said.

August 9’s fall was seen as a technical correction of the market, not a sign of the market starting its downtrend, SHS said, adding that the market may continue rising to 970 points in coming sessions.-VNS/VNA