Vietnam’s shares down for fourth day

Vietnamese shares fell further on both local exchanges on December 1, extending declines for a fourth day, led by financial stocks such as insurers.
Vietnam’s shares down for fourth day ảnh 1Illustrative image (Source: VNA)

Hanoi (VNA) - Vietnamese shares fell further on both local exchanges on December 1, extending declines for a fourth day, led by financial stocks such as insurers.

The benchmark VN Index on the HCM Stock Exchange dropped by 0.5 percent to close at 570.41 points, adding to a 4.2 percent decrease since November 25.

The HNX Index on the Hanoi Stock Exchange was down 0.4 percent to end at 80.26 points, down 2.2 percent during the last four days.

The insurance sector index yesterday dropped 2.9 percent, led by Bao Viet Holdings (BVH), which fell 3.7 percent.

"Bao Viet declined after foreign investors sold this stock strongly due to fears that the Vietnamese dong will weaken against other currencies, especially the US dollar", said Nguyen Xuan Binh, Deputy Head of Bao Viet Securities Corporation's Market Analysis.

The dong could weaken by as much as 4 percent next year following an interest rate hike made by the US central bank later this month, he said.

The recent rise of the selling price for the US dollar by local banks also discouraged foreign investors from buying local shares, which reduced the flow of foreign investment into the Vietnamese stock market, Binh said.

On November 30, local banks kept their selling prices between Vietnamese dong and the US dollar around 22,530 VND and 22,545 VND – almost equal to the limit level set by the State Bank of Vietnam, which is 22,547 VND.

In addition, the Japan-based media firm Nikkei Incorporate announced on December 1 that Vietnam's Purchasing Managers' Index (PMI) fell from 50.1 in October to 49.4 in November, indicating Vietnamese firms were going through a small slowdown in manufacturing.

The slowdown for manufacturing and processing sector came after new orders fell slightly for a third month due to lower market demand while production remained unchanged in November, Nikkei said.

The reduction of input costs following lower commodity prices such as oil and steel also made the output prices lower for local companies. Meanwhile, they had more inventory due to lower purchasing power, Nikkei added.

Those findings mean local producers will have worse performances on the stock market, Bao Viet Securities Corporation (BVSC) wrote in a report.

Following Nikkei's statement, local producers such as Vinamilk (VNM) fell 1.6 percent, auto part producer TMT Automobile Joint Stock Company (TMT) was down 1 percent, Garmex Saigon Joint Stock Company (GMC) dropped 1.3 percent.

Both local bourses traded more than 152.7 million shares, worth 2.23 trillion VND (99.4 million USD) – a decrease of 15.5 percent from the previous day.-VNA

VNA

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