Vietnamese shares sloped on Tuesday as recent rallies triggered a massive sell-off among investors to lock in profits and further market decline is in forecast for local markets.

The benchmark VN Index on the HCM Stock Exchange dropped 1.76 per cent to close at 1,020.76 points. It had rallied total 9.5 per cent in the previous eight consecutive sessions.

The HNX Index on the Ha Noi Stock Exchange lost 1.66 per cent to end at 116.49 points, extending its downtrend for a second day with total decline of 2.8 per cent.

More than 264 million shares were traded on the two local exchanges, worth VND7.18 trillion (US$319.2 million).

The market breadth was negative as declining stocks outnumbered gaining ones by 317 to 139 while 92 other stocks were unchanged.

The benchmark VN Index finally corrected after it had failed to surpass the 1,045-point level for three consecutive sessions on last-minute selling, Sai Gon-Ha Noi Securities Co (SHS) wrote in its daily report.

Massive sell-offs drowned 19 of the 20 sectors on the stock market. Key industries that saw share prices down included banking-financial, energy, rubber and plastic production and retail, data on vietstock.vn showed.

Large-cap stocks were hit strongly by profit-taking pressure. The large-cap VN30 Index fell 1.57 per cent to 1,008.76 points with 26 of the 30 largest stocks by market capitalisation suffering.

Among the worst-performing stocks in the VN30 basket were steel producer Hoa Sen Group (HSG), PetroVietnam Gas (GAS), Bank for Investment and Development of Viet Nam (BID) and consumer firm Masan (MSN).

Another factor that dampened market sentiment was foreign investors continuing to net-sell local assets, posting VND300 billion worth of net sell value on Tuesday, SHS said.

“As the market is being weighed down by some international news that could have big impacts, it is easy to understand that investors become more cautious and the market will likely extend its decline further and settle at lower price ranges,” SHS added.

“A short-term downtrend for the VN Index will likely happen and the benchmark may settle in the range of 1,000-1,500 points.”

According to Bao Viet Securities Co (BVSC), selling pressure was harsh as investors were concerned about the market’s reduction in the short term.

Therefore, the coming correction would occur in a two-week period and the market trading condition would become more stable when the index falls to the sentiment support of 1,000 points, BVSC predicted. — VNS