Record foreign sales of ETFs sink shares

Hanoi (VNA) - Shares sank for the third day on the two national stock exchanges, driven by record foreign sales in the final reallocation trading day for Exchange-Traded Funds (ETFs).

The benchmark VN-Index, the measure of 311 stocks on the HCM Stock Exchange, lost 0.7 percent to close at 651.3 points on September 16. The index slipped 0.5 percent in the two previous sessions.

On the smaller exchange in Hanoi, the HNX-Index tracking 379 stocks, also inched down 0.7 percent to end at 82.4 points. It lost 1.2 percent in the last two days.

September 16 was the final trading day for the FTSE and VNM ETFs to rearrange their portfolios. Like other days in their final quarterly review trade, the market was volatile and liquidity surged strongly.

A total of more than 280 million shares worth nearly 5.6 trillion VND (251 million USD) were traded in the two markets in the afternoon trade, reflecting a rise of 90.5 percent in volume and 143.5 percent in value, compared with September 15’s levels.

Foreign investors recorded a historic net selling session yesterday on the HCM City’s exchange, with a net value of nearly 1.5 trillion VND, a nearly 10-fold increase over September 15’s value and the highest number since 2013. This is also their 13th consecutive net selling session with a total value of almost 3.3 trillion VND.

In the Hanoi market, the foreign sector was also responsible for a net sell value of 55.3 billion VND.

Shares were very volatile as many stocks in the must-sold list of ETFs gained value while some shares, which they strongly purchased, tumbled.

Shares of dairy giant Vinamilk (VNM), the biggest listed stock, were down 3.5 percent on September 16, extending their three-day losses to 4.8 percent. FTSE and VNM ETFs were expected to buy a total of 11 million VNM shares during this portfolio review, but VNM shares were often listed among the most sold shares by foreign investors this week.

On September 16, foreigners only bought a net 30,800 VNM shares worth 1.2 trillion VND.

Steelmaker Hoa Sen Group, which topped most purchased stock by foreigners, also slumped 2 percent.

However, many in the most-sold list, such as the Hoa Phat Group (HPG), Sai Gon Securities Inc (SSI), real-estate developer VinGroup (VIC) and PetroVietnam Drilling and Wells Service (PVD) increased in value.

“This is the last opportunity for local investors to buy good shares at a low price,” stock analysts at Investment Vietnam Securities Co wrote in a report.

The market picture will become clearer during next week’s trade and good companies with positive earnings prospects in the third quarter could increase, the analysts added.-VNA