Investors at the An Binh Securities Company exchange floor. Local markets may decline further this week on lower oil prices. — VNS Photo Viet Thanh

HA NOI (Biz Hub) — Vietnamese stocks may fall further this week as investor confidence drops on declining oil prices and markets receive no positive news from the listed companies, brokerage firms wrote in their weekly forecast.

The benchmark VN Index on the HCM Stock Exchange dropped 0.5 per cent on Friday to close last week's trading at 558.43 points. The southern index fell 2.4 per cent from the previous week.

Meanwhile, the HNX Index on the Ha Noi Stock Exchange declined by 0.7 per cent to finish last week at 78.47 points, dropping 1.6 per cent over a week.

Oil prices may continue weighing on the markets as they declined sharply last week, erasing gains made earlier this year on increased US stockpiles and a stronger US dollar, while the largest oil producers were unwilling to co-operate with each other to boost prices.

US crude West Texas Intermediate (WTI) slumped 4 per cent on Friday to close trading at US$36.79 a barrel, a decrease of 6.7 per cent from the previous week, and London-traded Brent crude slipped 4.1 per cent to close at $38.67 a barrel, down 4.4 per cent over a week.

Lower oil prices sent investor confidence down, Sai Gon-Ha Noi Securities Corporation (SHS) wrote in its weekly report, adding that energy stocks suffered from the declining crude prices.

Local energy stocks made big losses last week, such as PetroVietnam Gas Corporation (GAS), which fell 8.2 per cent, PetroVietnam Drilling and Well Service Corporation (PVD), which dropped 4.8 per cent, and PetroVietnam Technical Service Corporation (PVS), which slid 6.7 per cent.

Low investor confidence was also found in the financial sector, which drove banks, insurance companies and brokerage firms down last week.

In the banking sector, Vietcombank (VCB), the Bank for Investment and Development of Viet Nam (BID), Vietinbank (CTG) and the Asia Commercial Bank (ACB) slipped 4.4 per cent, 4.1 per cent, 3.6 per cent and 1.6 per cent, respectively, during the week.

Among insurance and securities companies, insurer Bao Viet Holdings (BVH), BIDV Insurance Corporation (BIC), Saigon Securities Incorporation (SSI) and HCM City Securities Corporation (HCM) fell 6.3 per cent, 5.2 per cent, 1.9 per cent and 5.8 per cent, respectively.

Investors may also seek profits in stocks that made gains recently. This activity last week dragged down plastic and rubber producers.

Tien Phong Plastic JSC (NTP) slid 3.5 per cent in two days from a three-day rally of 10.6 per cent, Dong A Plastic JSC (DAG) dropped 5.3 per cent on Thursday and Friday after surging 17 per cent in three days, while Binh Minh Plastic JSC (BMP) dropped 4 per cent during last week.

Other large-cap stocks also had a bad trading week. Dairy firm Vinamilk (VNM) was flat, food producer Masan Group (MSN) fell 4.1 per cent, and software provider FPT Corporation (FPT) lost 2.3 per cent.

Declining investor confidence also reduced market liquidity. Both markets traded more than 198.5 million shares each trading day worth VND2.94 trillion (US$130.8 million), a decrease of 6.3 per cent in volume and 1.1 per cent in value from the previous week's figures. — VNS