ETFs: record foreign sales sink shares

Saturday, Sep 17, 2016 08:30

A trading session at Rong Viet Securities Co in HCM City. The benchmark VN-Index yesterday closed down 0.7 per cent at 651.3 points. — VNA/VNS Photo Pham Hau

HA NOI — Shares sank for a third day on the two national stock exchanges, driven by record foreign sales in the final reallocation trading day for Exchange-Traded Funds (ETFs).

The benchmark VN-Index, the measure of 311 stocks on the HCM Stock Exchange, lost 0.7 per cent to close yesterday at 651.3 points. The Index slipped 0.5 per cent in the two previous sessions.

On the smaller exchange in Ha Noi, the HNX-Index tracking 379 stocks, also inched down 0.7 per cent to end at 82.4 points. It lost 1.2 per cent in the last two days.

Yesterday was the final trading day for the FTSE and VNM ETFs to rearrange their portfolios. Like other days in their final quarterly review trade, the market was volatile and liquidity surged strongly.

A total of more than 280 million shares worth nearly VND5.6 trillion (US$251 million) were traded in the two markets in the afternoon trade, reflecting a rise of 90.5 per cent in volume and 143.5 per cent in value, compared with Thursday's levels.

Foreign investors recorded a historic net selling session yesterday on the HCM City's exchange, with a net value of nearly VND1.5 trillion, a nearly 10-fold increase over Thursday's value and the highest number since 2013. This is also their 13th consecutive net selling session with a total value of almost VND3.3 trillion.

In the Ha Noi market, the foreign sector was also responsible for a net sell value of VND55.3 billion.

Shares were very volatile as many stocks in the must-sold list of ETFs gained value while some shares, which they strongly purchased, tumbled.

Shares of dairy giant Vinamilk (VNM), the biggest listed stock, were down 3.5 per cent yesterday, extending their three-day losses to 4.8 per cent. FTSE and VNM ETFs were expected to buy a total of 11 million VNM shares during this portfolio review, but VNM shares were often listed among the most sold shares by foreign investors this week.

Yesterday, foreigners only bought a net 30,800 VNM shares worth VND1.2 trillion.

Steelmaker Hoa Sen Group, which topped most purchased stock by foreigners yesterday, also slumped 2 per cent.

However, many in the most-sold list, such as the Hoa Phat Group (HPG), Sai Gon Securities Inc (SSI), real-estate developer VinGroup (VIC) and PetroVietnam Drilling and Wells Service (PVD) increased in value.

"This is the last opportunity for local investors to buy good shares at a low price," stock analysts at Investment Vietnam Securities Co wrote in a report.

The market picture would become clearer during next week's trade and good companies with positive earnings prospects in the third quarter could increase, the analysts added. — VNS

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