VN Index falls for third day on plummeting investor confidence

VN Index falls for third day on plummeting investor confidence

Vietnamese shares were mixed on the two local exchanges yesterday, while the benchmark VN Index declined for a third session on lower investor confidence.

The benchmark VN Index on the HCM Stock Exchange dropped 0.2 per cent to close at 570.91 points, extending a three-day decline of 1.4 per cent.

Investor confidence declined on speculations that the US central bank will raise interest rates in April, and China has seen some short-term speculative funds leaving the market, Sai Gon-Ha Noi Securities Corporation (SHS) wrote in its daily report.

An interest rate hike made by the US central bank could force Viet Nam's central bank to weaken the Vietnamese dong so the economy stays competitive in relation to other nations.

Yesterday, Viet Nam's central bank raised its reference mid-point rate by VND5 to VND21,853 for a US dollar.

Lower investor confidence pulled large-cap stocks down, including dairy firm Vinamilk (VNM) and brokerage companies.

VNM dropped 1.5 per cent at the end of yesterday while among brokerage firms, HCM City Securities Corporation (HCM) fell 0.9 per cent, Sai Gon Securities Incorporation (SSI) declined by 1.8 per cent, and BIDV Securities Company (BSI) slumped 3 per cent.

Additionally, the banking sector weighed on the markets, led by the Bank for Investment and Development of Viet Nam (BIDV) and Vietinbank, on expectations that they will not benefit from the revised Decree 18/2016/ND-CP issued on Monday by the Government. It was issued to help banks reduce pressure on increasing their provisions for non-performing loans, Bao Viet Securities Corporation (BVSC) wrote in its daily report.

BVSC said that the revised decree aims to help banks that are being restructured and having trouble with financial conditions. But BIDV and Vietinbank are not among those banks.

At the end of the trading day, BIDV (BID) was down 1.7 per cent and Vietinbank (CTG) dropped 1.2 per cent.

The markets were boosted by automobile firms and some other large-cap stocks such as PetroVietnam Gas Corporation (GAS), property developer Vingroup JSC (VIC), insurer Bao Viet Holdings (BVH), and An Phat Plastic and Green Environment JSC (AAA).

GAS gained 1.1 per cent, VIC rose 0.6 per cent, BVH added 0.9 per cent and AAA jumped 4.2 per cent.

Both local markets traded nearly 186.4 million shares worth VND2.67 trillion (US$118.8 million), a decrease of 17.6 per cent from Monday's trading value.

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