Vietnam Index drops on sliding oil prices

Oil rigs of the Viet Nam - Russia Joint Venture Vietsovpetro at Bach Ho oil field. Energy stocks slid yesterday on falling crude prices. - VNA/VNS Photo Ha Thai

The benchmark VN Index on the HCM Stock Exchange fell 0.3 per cent to close at 658.50 points, down from a two-session gain of 0.5 per cent.

The HNX Index on the Ha Noi Stock Exchange managed to rise 0.2 per cent to end at 83.32 points. The northern market index has climbed a total 0.8 per cent in the last three days.

"Most energy stocks extended losses as investors' confidence was harmed after crude prices fell again," Maritime Securities Inc wrote in its daily report.

On global exchanges, London-traded Brent crude edged down 0.6 per cent to trade at US$48.75 a barrel. Brent has fallen 4.2 per cent from a month high of $50.89 a barrel on August 18.

In the local energy industry, PetroVietnam Gas Corp (GAS) dropped 2.4 per cent, PetroVietnam Coating Corp (PVB) lost 1.1 per cent and PetroVietnam Technical Services Corp (PVS) decreased by 1.4 per cent.

Property developer Vingroup JSC (VIC), Vietinbank (CTG) and Tien Phong Plastic JSC (NTP) were other stocks that contributed to the market's decline. Other blue chips such as Vietcombank (VCB) remained flat and hardly provided any support for the market.

VCB on Tuesday announced that the bank would issue nearly 933 million bonus shares for shareholders with a ratio of 35 per cent. Shareholder will receive 35 bonus shares for every 100 shares they own. The number of issued shares is worth nearly VND9.3 trillion ($414.6 million).

"The share issuance could help VCB rise in short-term trading," Bao Viet Securities Corp said in a note.

"The rise of VCB is expected to help push market up in the near future as VCB is one of the main driving factors of the stock market."

Foreign investors continued to end up as net sellers with a recorded net sell value of nearly VND70 billion on both local exchanges ahead of the US central bank's today meeting in which the bank may raise interest rates in September, the first rate hike since December 2015.

Viet Nam's central bank yesterday increased the daily reference mid-point rate by VND14 to VND21,898 for a dollar, an action that would help protect local exports.

Nearly 148.5 million shares were exchanged worth nearly VND3 trillion – an increase of 7 per cent from Wednesday's trading value.