Stocks fall on worries of tight margin lending
Stocks fall on worries of tight margin lending
Vietnamese shares ended Tuesday on a negative note as large-cap stocks were hit by strong selling as investors worried about a draft amendment on the initial margin to be passed by market regulators.
The benchmark VN Index inched down 0.05 per cent to close at 1,062.96 points after having rallied by a total of 5 per cent in the previous six straight sessions.
The minor HNX Index on the Ha Noi Stock Exchange fell 0.36 per cent to end at 121.59 points. It gained 1.06 per cent on Monday.
More than 406.6 million shares were traded on the two local exchanges, worth nearly VND9.2 trillion (US$408.4 million).
The trading figures were up 13 per cent in volume and 6 per cent in value compared to the numbers on Monday.
Market trading condition turned slightly negative with 237 declining stocks against 214 gainers. Another 144 other stocks ended flat.
Large-cap stocks were in negative territory with 16 of the 30 largest shares by market capitalisation in the VN30 Index falling, pulling the large-cap index down 0.12 per cent to 1,506.83 points.
The worst decliners among those stocks included steel producer Hoa Sen Group (HSG), Kinh Bac City Development Holdings (KBC), Sacombank (STB), Coteccons Construction (CTD) and FLC Faros Construction (ROS).
HSG slumped 4.4 per cent after Hoa Sen Group on Tuesday announced at its annual shareholder meeting that it targeted VND1.35 trillion in post-tax profit, a yearly reduction of 10 per cent.
STB was down 2.6 per cent after about 83 million shares in the bank were put up for sale and ROS fell 2 per cent from a three-day increase of 2 per cent.
On the positive side, shares in agricultural firms Hoang Anh Gia Lai (HAG) and HAGL Agrico (HNG) soared 7 per cent and 5.7 per cent respectively after they were removed from the warning list issued by the State Securities Commission.
Strong investor selling pressure was another factor that pushed the stock market down on Tuesday. This relates to a draft policy on raising the ratio of initial margin deposit at securities companies that may be passed by the State Securities Commission, according to Sai Gon-Ha Noi Securities Company (SHS).
“Today’s correction might be the results of investor reaction regarding yesterday’s news on ‘margin lending contraction’,” Viet Dragon Securities Company (VDSC) said in its daily report.
“The news could affect the market in the short-term, but it will not possibly create a significant correction,” VDSC said.
Sharing the same market outlook, SHS said that investor confidence remained strong on Tuesday. This helped the VN Index rebound from its intraday low of 1,052.43 points.
“The VN Index could continue struggling against investor selling pressure after it rising significantly to a range of 1,060-1,070 points,” SHS added.
