Profit-taking intensified during Wednesday afternoon trading, dragging shares down on both national stock exchanges and making market liquidity plunge.

The benchmark VN Index on HCM Stock Exchange dropped 1.76 per cent to close at 1,054.62 points, reversing from its three-day gain of 4.3 per cent.

The HNX Index on Ha Noi Stock Exchange lost 1.75 per cent to end at 121.49 points. It had gained 2.2 per cent in the last three sessions.

Nearly 219 million shares, worth VND4.9 trillion (US$214 million), were traded on the two local exchanges.

The market breadth was negative, with 291 declining stocks against 168 gaining stocks.

Large-cap stocks underperformed as the VN30 Index, tracking the performance of the 30 largest stocks by market capitalisation, tumbled 2.01 per cent to 1,034.30 points.

Twenty-four of the 30 largest stocks in the VN30 basket declined, including dairy firm Vinamilk (VNM), insurer Bao Viet Holdings (BVH), Masan Group (MSN), Viet Nam National Petroleum Group (PLX), FLC Faros Construction Joint Stock Company (ROS) and Vincom Retail Joint Stock Company (VRE).

Among declining sectors were insurance, banking, securities, real estate, consumer products, rubber production and retail, according to vietstock.vn

The worst-performing sectors were insurance, banking and brokerage companies, whose industry indices plunged 3 per cent, 2.2 per cent and 2.8 per cent, respectively.

Vietcombank, Bank For Investment and Development of Viet Nam, Vietinbank,VPBank and Military Bank, suffered most, decreasing from 2.3 per cent to 4 per cent.

Worst performers in the insurance and brokerage sectors included Bao Viet Holdings (BVH), PVI Holdings (PVI), Sai Gon Securities Incorporation (SSI), Ho Chi Minh City Securities Corporation (HCM) and Viet Capital Securities Joint Stock Company (VCI).

Meanwhile, the energy industry was boosted by a positive trading of crude. Since the beginning of May, Brent crude has increased by 4.1 per cent to trade at $78.3 per barrel.

Local large-cap energy stocks advanced between 0.9 per cent and 6.3 per cent following the news.

Also on the positive side, according to World biggest credit rating agency Fitch Ratings raised Viet Nam’s sovereign credit rating, noting the country’s improving track record on economic policy, debt and reform, according to its report released on May 15.

The rating agency said Viet Nam’s long-term foreign-currency issuer default rating has been upgraded to BB with a stable outlook, from BB-, adding that growth of 6.7 per cent is expected this year amid strong foreign direct investment (FDI), continued manufacturing expansion and a boost in private spending.

“This is good news for the stock market, which could encourage foreign investors to pour more money into Viet Nam,” BVSC said in its daily report.

Foreign investors saw a net selling of VND86 billion on HOSE with VNM (VND99 billion), HPG (VND58 billion) and VRE (VND26 billion). In contrast, they net bought VND37 billion on the HNX.

According to BIDV Securities Company, the shaking sessions were inevitable in the context that the market has experienced a protracted decline.

Investors should keep track of market signals, waiting for a stable stage to make a decision to disburse, it said. — VNS