Vietnamese shares nosedived on Thursday as investors remained pessimistic over the short-term market prospects while a bottom pickup near the day-end would not mean better sessions ahead for the stock market.
The benchmark VN Index on the HCM Stock Exchange tumbled 3.86 per cent or nearly 44 points to end at 1,094.63 points. It has dropped nearly 5.1 per cent in the last two sessions.
Thursday’s fall also marked the second worst-hit session for the VN Index since its historical slump of 5.1 per cent (more than 56 points) on February 5.
The HNX Index on the Ha Noi Stock Exchange lost 1.30 per cent to close at 131.05 points, totalling a two-day decline of nearly 2.4 per cent.
The two exchanges were mostly covered by declining stocks, which outnumbered gaining stocks by 324 to 142, while 104 other stocks were flat.
More than 258.7 million shares were traded on the two local exchanges, worth VND8.22 trillion (US$365.4 million), up 11 per cent in volume and 31 per cent in value compared to Wednesday.
Sharp increases in the trading liquidity over Wednesday proved investors poured a huge amount of cash into the stock market on Thursday to scoop up stocks after they had fallen steeply after two sessions.
According to securities companies, investors seemed to overreact to bad news on both global and domestic markets, including the US’ unwilling intention to join the CPTPP trade partnership and the latest arrests of former government officials in Viet Nam.
The overreaction proved investors were quite vulnerable towards negative news at the moment and it “reflected an overwhelming concern of investors,” Bao Viet Securities Co (BVSC) said in its daily report.
A sudden drop of investor confidence hit 17 of the 20 industries on the stock market and 26 of the 30 largest stocks by market capitalisation in the VN30 basket.
The large-cap VN30 Index plummeted 4.45 per cent or 49.61 points to 1,066.09 points, driven down mostly by financial-banking, real estate, retail and rubber stocks.
Among those sectors, banks, property developers and insurance companies were the worst hit. The three sector indices dived at least 5.2 per cent each.
The stocks that performed badly in the three industries included Vietcombank (VCB), Vietinbank (CTG), Bank for Investment and Development of Vietnam (BID), MBBank (MBB), HDBank (HDB), Sacomreal (SCR), Vingroup (VIC), HCM City Infrastructure Investment (CII) and Bao Viet Holdings (BVH).
However, the strong fall of local stocks signalled a good opportunity for investors to buy in shares that had dropped sharply in the last two sessions, proven by the increase of trading liquidity.
That signalled the VN Index could “recover in the next sessions” but that recovery “may not be sustainable” amid pessimistic and panic investors’ sentiment, BVSC said, adding that the VN Index could fall back to 1,055-1,065 point range. — VNS