VN Index falls on portfolio review

Saturday, Mar 18, 2017 09:15

Investors during a trading session at MB Securities Company. — VNS Photo Truong Vi
Viet Nam’s benchmark VN Index fell back yesterday while exchange-traded funds accelerated trading on the last day of portfolio reviews for the first quarter of 2017.

The HCM Stock Exchange’s index dropped 0.6 per cent to close at 710.54 points, reversing from Thursday’s gain of 0.3 per cent.

Yesterday’s decline also sent the VN Index down for a second week with a total decrease of 0.2 per cent from the previous trading week.

The focus of the stock market yesterday was the portfolio review conducted by the two major foreign-run exchange-traded funds (ETFs) that are present in Viet Nam’s securities market: FTSE Vietnam ETF and VNM Vietnam ETF.

On the last day of the portfolio review, the two ETFs helped boost market trading liquidity sharply with nearly 253.2 million shares being traded worth VND5.2 trillion (US$231.8 million).

Yesterday’s trading figures were 41.4 per cent and 32 per cent higher in trading volume and trading value, respectively, compared to Thursday.

The stock market fell as the ETFs purchased shares of the targeted companies through advance negotiations with shareholders given high supply from other investors, keeping the prices of those stocks at very low levels.

Foreign investors yesterday recorded a net sell value of VND286.36 billion, in contrast to the VND197.2 billion net buy value made on Thursday.

Stocks that were added into the investment portfolios of those ETFs included property developer Novaland (NVL) and Faros Construction Corp (ROS).

The new strategy used by the ETFs sent the two stocks down to their daily trading limit of 6.9 per cent and 7 per cent, respectively.

As Faros and Novaland are the two large-cap groups in the stock market, the decline of their share prices were the major factor pushing the VN Index down.

Other stocks that were expected to be active on foreign buying such as Dat Xanh Real Estate Service & Construction Corporation (DXG) and Hoa Binh Construction & Real Estate Corporation (HBC) also fell hard.

In addition, other blue chips also ended in the “red” area and provided little support for the southern market.

On the opposite side, the HNX Index on the Ha Noi Stock Exchange gained 0.5 per cent to end at 88.38 points. The northern market index has rallied for a fourth day with a total growth of 1.6 per cent.

The four-day rally also helped the HNX Index record a four-week rising streak. It has increased by 2.9 per cent since February 17.

More than 64.7 million shares were exchanged on the HNX market, worth VND951 billion. – VNS


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