Illustrative photo (Source: VNA)
Hanoi (VNA) - Vietnamese shares declined slightly on November 16 on both local exchanges, reversing after a two-day winning streak, as the financial sector slumped after the terror attacks in Paris last week.
The benchmark VN Index on the HCM Stock Exchange inched down 0.3 percent to finish at 609.32 points and the HNX Index on the Hanoi Stock Exchange edged down 0.6 percent to end at 81.05 points.
"The attacks could temporarily destabilise the world's financial markets and lower global economic growth potential," said Nguyen Xuan Binh, Deputy Head of Bao Viet Securities Corporation's Market Analysis.
Binh said that the unstable conditions in the world's financial markets caused by the terror attacks could encouraged foreign investors to sell their assets in riskier investments such as emerging markets and move into the safety of the dollar-dominated investments.
In fact, the attacks in Paris was the major reason that drove Asian stocks down to six-week lows on November 16, for example, the Japanese Nikkei 225 was down 1 percent.
Vietnam's banking sector index dropped 1 percent following the attacks with none of nine listed banks making gains, including Vietcombank (VCB) and the Bank for Investment and Development of Vietnam (BID) which each lost 0.8 percent, Vietinbank (CTG) dropped 1.5 percent and Eximbank (EIB) fell 1.7 percent.
These banks declined after they all reported lower quarterly profits than expected last week due to increasing their financial risk provisions.
For example, Eximbank earned a quarterly net profit of 83 billion VND (3.7 million USD), a decrease of 62 percent from a year ago, as the bank increased its credit risk provision four times to 332 billion VND (14.8 million USD) over a year.
In addition, local energy stocks suffered losses after global oil prices, including the US benchmark crude West Texas Intermediate (WTI) and Brent crude, fell 8 percent last week.
The biggest energy firms such as PetroVietnam Gas Corporation (GAS) dropped 1.2 percent, PetroVietnam Drilling & Well Services Corporation (PVD) lost 2.1 percent and PetroVietnam Technical Services Corporation (PVS) was down 1 percent.
The insurance sector index fell 1.5 percent on November 16 as the leading insurer Bao Viet Holdings (BVH) slumped 1.7 percent after the company recorded a third-quarter net profit of 218 billion VND (9.7 million USD), a decrease of one-third from last year's number.
On the positive side, plastics producers remained the major force that prevented the stock market from declining further as they benefited from lower prices for importing crude as production inputs.
The leading plastic producers, Binh Minh Plastics JSC (BMP) jumped 3.8 percent and Tien Phong Plastics JSC (NTP) surged 4.3 percent.
Both local exchanges traded more than 189 million shares, worth 3.23 trillion VND (143.7 million USD), an increase of 19.3 percent from last week's daily trading value.-VNA
