Bank shares fell on June 22, pushing the VN-Index down (Photo: shs.com.vn)Hanoi (VNA) –Shares declined for the first time in the last three days as banks lostmomentum on June 21 on rising profit-taking pressure after a long rally.
The benchmark VN-Index inched down 0.08 percent to close at 767.41 points. TheHCM Stock Exchange’s index rose nearly 1 percent in the two previous sessions.
On the Hanoi Stock Exchange, the HNX-Index was down 1.12 percent to end at98.68 points. The northern market index expanded 1.5 percent in the last twotrades.
Bank stocks slumped with six of nine listed banks on the two exchanges losingvalue.
Three largest listed lenders – Vietcombank (VCB), Vietinbank (CTG), BIDV (BID)– slipped 3.2 percent, 3.1 percent and 1.2 percent, respectively. Other bankson the Hanoi bourse fell between 1.3-7.7 percent each.
Only Eximbank (EIB), Sacombank (STB) and Military Bank (MBB) maintained growth.
[Vietnam’s securities market grows more attractive to foreign investors]
The National Assembly on June 21 officially approved the resolution on bad debtsettlement which takes effect for five years starting from August 15, 2017 anddeals with non-performing loans (NPLs) arising until the date that theresolution takes effect.
“Basically, this is supportive information for the banking sector in generaland some banks currently struggling with bad debts in particular (typically BIDand STB),” said Tran Hai Yen, a stock analyst at Bao Viet Securities Co.
“However, because this information is not new and has been reflected in thecurrent upward trend of bank stocks, the official approval cannot offer moresupportive effects,” Yen wrote in a report on June 21.
In the medium term, she forecast that bank stocks could maintain currentupwards momentum when the bad debt settlement resolution starts to bring actualimprovements.
In another event that affected the market, MSCI on June 21 announced theresults of a market classification review following which, despite highexpectations of investors, the Vietnamese stock market has yet to be includedin the emerging market index and will remain a frontier market.
The local market has satisfied some quantitative criteria such ascapitalisation and liquidity but fell short of some requirements such as liquidityreadiness and openness to foreign investors.
“Therefore, Vietnam still has room to be considered for inclusion in theemerging market index and this information could return and support theVN-Index in the medium term,” Yen said.
Some large-cap stocks recovered near the end of the session and cushioned themarket fall, including Vinamilk (VNM), Petrolimex (PLX), brewery Sabeco (SAB),real estate developer VinGroup (VIC), tech giant FPT Corp (FPT) and MobileWorld Group (MWG).
Liquidity remained high with a total of over 320 million shares worth acombined 5.34 trillion VND (235.4 million USD) being traded on the two markets,up 7.7 percent in volume but down 3.4 percent in value compared to June 20’s levels.-VNA
VNA
