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VN shares fall as oil prices drop
Vietnamese shares yesterday fell on both local exchanges led by energy firms dragged down by lower global oil prices.
The benchmark VN Index on the HCM Stock Exchange fell 1.4 per cent to close at 563.62 points and the HNX Index on the Ha Noi Stock Exchange was down 0.5 per cent to finish at 79.72 points.
Local energy companies fell after members of the Organisation of Petroleum Exporting Countries (OPEC) on Friday decided to maintain current production output quotas to secure their market shares.
That decision made global oil prices decline sharply on Friday. The US benchmark crude West Texas Intermediate (WTI) fell 2.7 per cent to trade at US$39.97 a barrel and fell a further 1.4 per cent to $39.43 in trading in Asia yesterday.
As a result, local energy stocks pulled back from their Friday values. PetroVietnam Gas Corporation (GAS) lost 2.2 per cent, PetroVietnam Drilling & Well Services Corporation (PVD) dropped 2.9 per cent and Petrolimex Gas Corporation (PGC) was down 0.7 per cent.
Meanwhile, financial firms, such as banks and insurers, extended losses from Friday ahead of the US central bank's expected rate hikes at the meeting next week, which would affect their profitability, Sai Gon Ha Noi Securities Corporation (SHS) wrote in its report.
The biggest banks such as Vietcombank (VCB) fell sharply by 3.6 per cent, the Bank for Investment and Development of Vietnam (BID) dropped 1.4 per cent, Sacombank (STB) lost 3.5 per cent.
Among insurers, Bao Viet Holdings (BVH) lost 3 per cent, Viet Nam National Reinsurance Corporation (VNR) dropped 2.2 per cent, and BIDV Insurance Corporation (BIC) fell 1.6 per cent.
Some selling activity was attributed to securities firms forcing investors who are trading on margin to cover their debts with the brokerages, SHS said.
Investors also sold some large-cap stocks that have made big gains recently such as Vinamilk (VNM). VNM, which yesterday fell 2.4 per cent and has dropped 14.2 per cent over the last 15 sessions since its all-time high last month.
Both local exchanges traded nearly 115 million shares, worth VND1.84 trillion ($81.7 million), a decrease of one-fifth from last week's daily trading value.
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