VN-Index sheds nearly 44 points as selling pressure spreads

Selling pressure grips Vietnam market

The VN-Index on the Ho Chi Minh Stock Exchange (HoSE) fell 43.94 points, or 2.46 percent, on Monday to 1,743.51, marking its steepest decline in nearly a month.

The VN30-Index also dropped 44.33 points, or 2.29 percent, from the previous session to 1,887.32.

The sell-off spread to the other exchanges, with the HNX-Index down 7.29 points, or 2.5 percent, at 284.41 and the UPCoM-Index losing 1.04 points, or 0.82 percent, to 126.34.

Market breadth was overwhelmingly negative, with 561 stocks declining, including 50 that hit their floor prices.

Only 131 stocks advanced, with 20 reaching their ceiling prices.

The VN-Index remained in negative territory throughout the session, at one point falling more than 53 points to below 1,735.

Late bottom-fishing demand helped narrow the loss to 43.94 points at the close.

Liquidity remained high, with total trading value across the three exchanges exceeding VND21.18 trillion (US$805.5 million) as nearly 966 million shares changed hands.

Matched-order transactions accounted for about VND19.27 trillion ($732.89 million), while put-through deals totaled nearly VND1.91 trillion ($72.58 million).

Kafi Securities research director Luong Duong Phuoc attributed the market’s sharp fall on July 20 mainly to stretched valuations and weak investor sentiment, rather than any deterioration in corporate fundamentals.

Phuoc said expectations remained positive for the second-quarter earnings season, with listed companies’ profits forecast to grow 15-17 percent year-on-year.

A key source of pressure was the renewed rise in deposit rates, as credit grew about 7.73 percent in the first half, well above the 5.02 percent increase in deposits.

The gap could prompt banks to raise deposit rates further, making savings products and bonds more attractive and drawing funds away from equities.

Oil prices approaching $90 a barrel and the U.S. Federal Reserve’s continued high interest rates have also made investors more cautious about risk assets in emerging markets.

Dozens of stocks hit floor prices

Selling swept across most sectors, with financial stocks bearing the brunt.

Brokerage stocks were among the hardest hit, as VIX, CTS, FTS, VDS and BSI closed at their floor prices, while SSI, VCI and MBS fell 5-7 percent.

Banking stocks also came under heavy selling pressure, with SHB hitting its floor price and BID, TCB, CTG, MBB, VPB and VCB each falling more than 3 percent.

LPB was a rare bright spot as it gained 1.13 percent.

Real estate stocks also came under heavy selling pressure, with DIG, DXG, DXS and HDC hitting their floor prices, while TCH fell nearly 7 percent.

VHM, VRE, PDR and KDH also posted steep losses.

Steel and materials stocks remained weak, as HPG and HSG each dropped nearly 6 percent, while DCM and DPM also declined.

Losses extended to retail, consumer and industrial stocks.

MSN fell 4.71 percent, PNJ lost 4.65 percent and MWG dropped nearly 2 percent, while GEX, CII, VCG and VSC each fell more than 6 percent.

VCB was the biggest drag on the VN-Index, shaving 3.16 points off the benchmark, followed by VHM, BID, TCB and HPG. LPB provided the strongest support but added only 0.39 points, alongside VJC, SAB and FPT.