Vietnamese shares fall as oil prices drop
Vietnamese shares on December 7 fell on both local exchanges led by energy firms dragged down by lower global oil prices.
Illustrative image (Photo:VNA)The benchmark VN Index on the HCM Stock Exchange fell 1.4 percent to close at 563.62 points and the HNX Index on the Hanoi Stock Exchange was down 0.5 percent to finish at 79.72 points.
Local energy companies fell after members of the Organisation of Petroleum Exporting Countries (OPEC) on December 4 decided to maintain current production output quotas to secure their market shares.
That decision made global oil prices decline sharply on December 4. The US benchmark crude West Texas Intermediate (WTI) fell 2.7 percent to trade at 39.97 USD a barrel and fell a further 1.4 percent to 39.43 USD in trading in Asia on December 7.
As a result, local energy stocks pulled back from their December 4 values. PetroVietnam Gas Corporation (GAS) lost 2.2 percent, PetroVietnam Drilling & Well Services Corporation (PVD) dropped 2.9 percent and Petrolimex Gas Corporation (PGC) was down 0.7 percent.
Meanwhile, financial firms, such as banks and insurers, extended losses from December 4 ahead of the US central bank's expected rate hikes at the meeting next week, which would affect their profitability, Saigon-Hanoi Securities Corporation (SHS) wrote in its report.
The biggest banks such as Vietcombank (VCB) fell sharply by 3.6 percent, the Bank for Investment and Development of Vietnam (BID) dropped 1.4 percent, Sacombank (STB) lost 3.5 percent.
Among insurers, Bao Viet Holdings (BVH) lost 3 percent, Vietnam National Reinsurance Corporation (VNR) dropped 2.2 percent, and BIDV Insurance Corporation (BIC) fell 1.6 percent.
Some selling activity was attributed to securities firms forcing investors who are trading on margin to cover their debts with the brokerages, SHS said.
Investors also sold some large-cap stocks that have made big gains recently such as Vinamilk (VNM). VNM, which on December 7 fell 2.4 percent and has dropped 14.2 percent over the last 15 sessions since its all-time high last month.
Both local exchanges traded nearly 115 million shares, worth 1.84 trillion VND (81.7 million USD), a decrease of one-fifth from last week's daily trading value.-VNA
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