Shares slide on fears of bull trap
Shares slide on fears of bull trap
Shares tumbled on both national stock exchanges on Monday after an unexpected rebound last Friday, as investors feared a likely bull trap.
The benchmark VN-Index on the HCM Stock Exchange tumbled 3.85 per cent or nearly 44 points, to end Monday at 1,076.78 points.
The index rose 2.30 per cent, or 25.23 points, to end last Friday at 1,119.86 points. It had fallen a total of 5.1 per cent in the previous two sessions.
Bao Viet Securities Co (BVSC) said in its daily report that selling pressure increased in the final minutes, so the VN-Index settled at the lowest point in the session. Therefore, the index may still decline in the next session.
The HNX Index on the Ha Noi Stock Exchange lost 4.86 per cent to close at 126.14 points. It increased by 1.16 per cent to close at 132.58 points on Friday. The northern market index dropped total 2.4 per cent in the previous two trading days.
The two exchanges were mostly covered by declining stocks, which outnumbered gaining stocks by 347 to 136, while 259 other stocks were flat.
More than 289.6 million shares were traded on the two local exchanges, worth VND8.36 trillion (US$367 million).
Last Friday’s rebound did not last as investors feared being caught in a bull trap, thereby resulting in low buying demand as sellers were forced to lower stock prices.
A sudden drop of investor confidence hit 18 of the 20 industries on the stock market and 24 of the 30 largest stocks by market capitalisation in the VN30 basket.
The large-cap VN30 Index plummeted 3.13 per cent or 34.08 points to 1,055.37 points, driven down mostly by financial-banking, real estate and construction and building materials, retail and rubber stocks.
Among those sectors, banks, brokerages and construction and building materials companies were the worst hit. The three sector indices dived at least 4.7 per cent each.
Bank stocks were strongly sold off, closing at floor prices, including Vietcombank (VCB), losing 5.8 points, Vietinbank (CTG), VP Bank (VPB) and Military Bank, all decreasing 6.9 per cent, and HD Bank, tumbling 7 per cent.
Meanwhile, the worst performers in the securities sectors were Ho Chi Minh City Securities Corporation (HCM), down to floor prices of 7 per cent. Three other companies of Sai Gon Securities Incorporation (SSI), Viet Capital Securities Joint Stock Company (VCI) and VNDirect Securities Corporation (VND), decreased at least 6.8 per cent.
BVSC said after the bearish session on Friday, the market was likely to see technical recovery in the coming sessions.
“However, we need more clear signals to confirm the sustainability of this rebound and the end of the downtrend,” it added.
