Stocks retreat on large cap profit-taking
Stocks retreat on large cap profit-taking
Shares fell in both local markets on Tuesday as large-cap stocks were hit by strong profit-taking from investors.
The benchmark VN Index on the HCM Stock Exchange dropped 0.65 per cent to close at 767.51 points. It had gained 0.8 per cent total in the previous two trading sessions.
The HNX Index on the Ha Noi Stock Exchange lost 0.72 per cent to end at 98.02 points. The northern market index rose 0.5 per cent on Monday.
More than 278.5 million shares were traded on both local bourses, worth VND4.67 trillion (US$207.9 million).
The market declined--following a two-session increase--was attributed to sales of large-cap stocks, which had increased sharply in the previous trading days. Investors wanted to make some short-term profits in those profitable stocks, according to BIDV Securities Company (BSC).
Two-thirds of large-cap stocks in the VN30 Index, which tracks the performance of the 30 largest companies by market capitalisation, ended in the negative territory on Tuesday.
The Ha Noi-based brokerage firm said in its report that bank stocks and shares of fuel station operator Petrolimex (PLX) were the main factors that pushed the market down on Monday.
PLX slumped 4.2 per cent after a six-day rally with a total growth of 15 per cent.
Of the nine listed banks, only Sacombank (STB) advanced. Declining bank stocks included Asia Commercial Bank (ACB), BIDV (BID), Vietinbank (CTG) and Vietcombank (VCB).
BID went down 1.5 per cent, CTG fell 1.3 per cent and VCB decreased by 0.7 per cent. These three bank stocks had risen total 1.7 per cent, 1.5 per cent and 1.1 per cent respectively during the previous two sessions.
Other declining large-cap shares in the VN30 Index included PetroVietnam Drilling and Well Services (PVD), agriculture firms Hoang Anh Gia Lai Group (HAG) and HAGL Agrico (HNG), and food producer Kido (KDC).
The decline of the stock market on Tuesday was also a signal that investors were restructuring their portfolios to prepare for opportunities to make investment in companies that could produce good earnings reports for the second quarter, BSC said.
Sai Gon-Ha Noi Securities (SHS) said in a note that Tuesday’s decline was only a backward step needed to ease the pressure created by recent high margin loans.
The current market conditions may continue in the next few days, according to SHS: “The VN Index will move narrowly on Wednesday between 764 and 770 points.”
