Trade war worries shadow earnings hopes, oil gains

Thursday, Oct 10, 2019 07:39

A PetroVietnam Gas tanker. The company's shares gained 0.4 per cent on Wednesday following increases in crude prices. — Photo

Vietnamese shares fluctuated on Wednesday as investors remained uncertain about a deal being struck between the US and China despite earnings prospects in some key sectors.

The benchmark VN-Index on the Ho Chi Minh Stock Exchange ended down 0.04 per cent at 987.83 points after having gained 0.38 per cent during the day.

The benchmark rose 0.52 per cent on Tuesday.

More than 182.5 million shares were traded on the southern bourse, worth VND4.1 trillion (US$176.3 million).

The benchmark VN-Index struggled due to market sentiment clouded by pessimism about the chance of a deal between the US and China to cool down their trade war.

The two governments this week have announced some restrictions on each other’s businesses and administrative work, which will trim the chances of them reaching an agreement this weekend.

According to Bao Viet Securities Co (BVSC), negative developments in US-China trade relations would ruin the domestic market’s short-term growth.

Insurance, securities, food and beverage, healthcare and pharmaceuticals, seafood processing and rubber were among the sectors that declined.

Large-cap stocks provided little support for the market, as the 30 largest stocks by market capitalisation and trading liquidity were on different paths.

Half of the blue chips in the VN30 basket declined while 12 increased, pulling the VN30-Index down 0.08 per cent.

Decliners in the large-cap group included dairy firm Vinamilk (VNM), insurer Bao Viet (BVH), brewer Sabeco (SAB) and SSI Securities (SSI).

On the positive side, earnings prospects continued lifting retail, technology, building materials and construction industries, according to Thanh Cong Securities Co (TCSC).

Energy firms also helped cushion market confidence on Wednesday following increases in oil prices.

Brent crude and West Texas Intermediate (WTI) crude gained nearly 1 per cent each on Wednesday.

PetroVietnam Gas (GAS) was up 0.4 per cent and PetroVietnam Drilling and Well Services (PVD) rose 1.2 per cent.

Wednesday’s decline proved the benchmark VN-Index had just technically recovered on Tuesday and investors were clearly doubtful and waiting for better market conditions, MB Securities Co (MBS) said in its daily report.

The VN-Index would continue swinging in the 980-990 point zone with a focus being put on banks and other stocks with expectations of positive earnings reports, the company said.

On the Ha Noi Stock Exchange, the HNX-Index gained 0.68 per cent to close at 104.62 points, totalling two-day growth of 0.86 per cent.

More than 23.2 million shares were traded on the northern bourse, worth VND317.4 billion. VNS

Comments (0)