Third-quarter earnings reports from large-cap companies have signalled the earnings season is near its end, pushing investors back to a defensive zone and again putting pressure on the stock market with low confidence.

Viet Nam’s benchmark VN-Index on the Ho Chi Minh Stock Exchange fell 0.74 per cent to end Thursday at 907.96 points.

The southern market index rose 2.93 per cent on Wednesday, thanks to impressive Q3 earnings reports from large-cap firms such as property developer Vingroup and its sub-units Vincom Retail and Vinhomes.

The HNX Index on the Ha Noi Stock Exchange shed nearly 2 per cent to close at 103.37 points.

The northern market index had gained 4.1 per cent in the previous two sessions.

Despite US stocks advancing later on Wednesday night, the Vietnamese stock market went the opposite way and showed low investor confidence in the market’s uptrend,” Sai Gon-Ha Noi Securities JSC (SHS) wrote in its daily report.

A large number of listed companies have released their quarterly and nine-month earnings reports. Data from the two exchanges showed that as of October 25, 326 of the 759 listed companies on the two local exchanges had released their earnings reports.

This week, the number of companies releasing quarterly earnings reports increased with the inclusion of Vingroup (VIC), Vincom Retail (VRE), Vinhomes (VHM), dairy producer Vinamilk (VNM), Techcombank (TCB) and brewer Sabeco (SAB).

Those six listed companies are among the top 10 largest firms by market capitalisation and any change in their share prices would have enormous impacts on the market .

Other top-10 blue chips had already announced their Q3 earnings reports, including Vietcombank (VCB), PetroVietnam Gas (GAS), Bank for Investment and Development of Viet Nam (BID), Vietinbank (CTG) and consumer company Masan (MSN).

Among the top 30 largest stocks by market capitalisation, the companies having announced their Q3 results included budget carrier Vietjet (VJC), food business Kido Group (KDC), digital retailer Mobile World (MWG), Saigon Securities Inc (SSI) and steel producers Hoa Sen (HSG) and Hoa Phat (HPG).

The momentum of the market uptrend provided by large-cap companies is running out as their earnings prospects had been priced in earlier.

Wednesday’s session was a “technical recovery span” for the market and the market “needs more positive sessions to confirm it’s a reversal”, Viet Dragon Securities JSC said in a note.

Trading liquidity on Thursday was actually lower than the average of the previous 20 session if excluding put-through deals, SHS said.

Nearly 220 million shares were traded on the two exchanges, worth nearly VND6.8 trillion (US$302.2 million), lower than Wednesday’s figures of 255 million shares and VND7.53 trillion.

The market breadth was also negative with the number of declining stocks doubling that of gainers by 284 to 144.

Lower trading liquidity and negative market breadth proved the stock market had to suffer from strong selling pressure and “big investors had yet to return to trading and chose to stand by in the current conditions”, SHS added.

Foreign trading was also not good enough, SHS said.

“If the net foreign purchase of Masan shares worth VND2.15 trillion, was not counted, foreign investors actually net-sold VND142 billion in today’s session.”

“The market short-term trend remains unclear and the VN-Index could move between 885 and 915 points on Friday with strong volatility,” SHS forecast. — VNS