VN shares tumble on global tension

Thursday, Aug 10, 2017 08:40

An investor watches stocks move at Vietcombank Securities Company. Vietnamese shares were rocked on Wednesday on rising tension between the US and North Korea and false rumours of the arrest of a former bank executive. — VNA/VNS Photo Tuan Anh

Vietnamese shares tumbled on Wednesday on both local markets as investors triggered large-scale sell-offs following rising tension between the US and North Korea and false news about the arrest of a former banker.

The benchmark VN Index on the HCM Stock Exchange plunged 2.26 per cent to close at 773.66 points, extending its decline for a second session with total loss of 2.4 per cent.

The HNX Index on the Ha Noi Stock Exchange dropped 1.19 per cent to end at 101.07 points. The northern market index inched down 0.1 per cent on Tuesday.

The stock market turned chaotic when investors triggered large-scale sell-offs in all sectors with nearly 428.5 million shares being traded on both local bourses, worth VND6.3 trillion (US$280 million).

Wednesday’s trading figures were up 36 per cent in volume and 29 per cent in value compared to Tuesday’s numbers.

Among all 20 industries, the worst declining stocks were found in financial-banking, energy and real estate sectors.

Vieet Nam’s stock market plunged on Wednesday as investor confidence was pulled down by rising tension between the US and North Korea threatening to conduct military action against each other, according to Bao Viet Securities Company (BVSC).

Rising tension between the two countries caused investors around the globe to drop stocks and turn to safe havens such as gold.

Vietnamese gold prices were up between VND10,000 and VND30,000 per tael on Wednesday for both selling and buying orders while spot gold on the global markets moved up 0.4 per cent to $1,265.18 an ounce.

Foreign investors ended as net sellers after being net buyers for 14 consecutive sessions. They posted a net sell value of VND16.9 billion, reversing from Tuesday’s net buy value of VND123.5 billion.

Viet Nam’s stock market was also rocked by a market rumour that police arrested former chairman of the Bank for Investment and Development of Viet Nam (BIDV), Tran Bac Ha. However, a public security official and Ha confirmed with local media that there was no arrest.

BIDV shares, listed as BID on the HCM Stock Exchange, plummeted 6.8 per cent, hitting its daily trading limit. As one of the largest lenders by market capitalisation, its fall was clearly among main reasons that the banking sector suffered a big loss on Wednesday.

BVSC said in its daily report that the sharp decline on Wednesday only reflected investors’ panic at a specific moment as the chance of a military conflict between the US and North Korea is quite low while the arrest of the former banking executive was confirmed to be untrue to investors.

Therefore, Wednesday’s fall should be only a short-term decline and any sell-offs at the moment are unnecessary, BVSC said, adding that the market would trade in the negative trend over the next few sessions. — VNS

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