Shares fell for a second day as foreign blue chip offloading pushed those stocks down and sinking oil prices caused energy sector volatility.

The benchmark VN Index on the HCM Stock Exchange dropped 0.3 per cent to close at 675.87 points. The southern market index has lost 1.1 per cent after two sessions, erasing nearly all the increase made in the week’s first three sessions.

The HNX Index on the Ha Noi Stock Exchange slid 0.2 per cent to finish at 80.99 points, producing a two-day decline of 0.5 per cent.

Both local market indexes ended this week slightly higher than the previous week’s closing levels. The VN Index and the HNX Index were up 0.4 per cent each after a week.

Foreign investors remained net sellers in the past five trading sessions, and their blue chip sales clearly affected market sentiments.

Foreign investors yesterday recorded a net sell value of VND290 billion (US$12.9 million), the highest sell value in the last two months, totaling their net sell value for this week at VND810 billion, the highest in the last three months.

Some analysts pointed to the foreign exchange rate between the Vietnamese dong and the US dollar--which has remained high during the past three months--as the major factor encouraging foreign investors to sell a part of their portfolios in order to gain profits.

The State Bank of Viet Nam yesterday set its daily reference mid-point rate for foreign currency trade among local banks at VND22,137, the highest since the central bank applied the mid-point rate on January 4.

Rising exchange rates in the domestic market was caused by market expectations that the US central bank would increase its lending rates in December.

Among the 10 largest companies by market capitalisation, dairy firm Vinamilk (VNM) was hit the worst by foreign selling after foreign investors offloaded total VND460 billion worth of Vinamilk’s shares during the week.

VNM yesterday was down 1.6 per cent, totaling a three-day loss of 4.4 per cent. A part from foreign selling, VNM was also affected by the news that the State Capital Investment Corporation (SCIC) would organise the auction to sell 9 per cent of Vinamilk’s chartered capital on December 12, 10 days later than the previous plan.

Other blue chips, including consumer goods producer Masan Group (MSN), Vietcombank (VCB) and Vietinbank (CTG), also declined. Among these stocks, MSN slipped 1.3 per cent, the first decline after surging 11 per cent in the previous eight sessions.

Energy stocks remained negative as crude prices declined on investors’ cautious stance towards OPEC’s meeting next week, in which the group are expected to reach an agreement to reduce their current production and stabilise the market.

Market trading liquidity increased from Thursday’s figures. More than 176.7 million shares were exchanged worth nearly VND3.28 trillion, an increase of 10.4 per cent in trading volume and 17.8 per cent in value. — VNS