May 18: VN index breaks down 460 on massive selling

Vietnam’s stocks had another plunge session today, extending the losing streak to a fifth day in a row as local investors sold shares to cut loss.

The benchmark VN Index lost 9.44 points or 2.03% to 454.91. Volume rose 18.3% to 28.5 million shares changing hands for VND537.48 billion.

Rising volume indicated higher selling pressure, talked to be from those who are highly exposed to margin facilities, but it also showed the signs of smart-money entering the market.

Headlines showed that banks in Ho Chi Minh City net bought $32 million dollars from the public in the past 3 months.

Meanwhile, dong liquidity in the banking system seemed to improve reflecting in the plunge of inter-bank overnight rate to 14% from previous 20% despite continuous liquidity withdrawal by the SBV in OMO in the past 2 weeks. The higher dong liquidity in the system is believed to come from SBV dollar buying.

Vietnam Custom data showed that the country suffered a trade deficit of $1.493 billion in April, highest in 16 months and extending the trade gap to $4.889 billion or 17.94% export revenue in the first 4 months of the year.

In related news, local gold price fell under VND37.4 million a tael on low demand, interbank dollar rate stayed unchanged at VND20.673. Local banks briefly quoted dollar prices at the ceiling before adjusting it down right in the morning session.

Back to the market, sharp fall was seen from the beginning of the trading session. The loss was deepened as market progress, at some time in the continuous trading session, panic was felt. However, the entering of smart money calmed down the market. VN Index closed off the lows but still lowest of the three trading phases.

The breadth was largely negative, losers outweighed gainers by 169-57, 63 stocks unchanged. The number of floor losers was 45 while 8 others gained 5% limit. The loss was broad-based, heavy-weigh blue chips were among top losers including MSN, BVH, HAG, VIC, VPL. This showed the intension of the bears.
VCB continued to be the spotlight today but because of its volume and fighting rather than stock prices. The bulls and the bears crowded there and the real fight was seen in the early trade.

VCB was traded at ceiling price of VND32,400 with over 400,000 shares changed hands in ATO, big enough to see the selling pressure. Soon after ATO session, big block offers stormed into outstanding bids sweeping away nearly 900,000 share bids at ceiling price. Aggressive selling sent the share price back to the neutral line before buying interest buoyed it back to VND31,900 at the close.

Today trade was the first test of VND32,000 resistance, the fight will continue but traders expect share price not to move far from this point either side for the time being. Foreigners bought 1,159,400 VNC shares, over 50% of the total 2,245,670 VCB shares traded today, making it the most active stock.

STB was the second most active stock with 2.2 million shares traded, closing flat at VND12,400.

SSI was in the third place with 1.7 million shares traded, closing down 0.5% to VND19,300.

REE and EIB followed in the list with 0.9 million shares and 0.8 million shares traded, respectively.

It should be noted that most active stocks today were all blue chips, cutting loss effort might be the reason behind the move.

On the Hanoi Stock Exchange, the HNX posted loss for a seven day in a row, closing down 0.7 point or 0.88% at 78.86.

Trading volume rose by 15.3% to 28.67 million shares worth VND347.63 billion traded, including 3.9 million shares changed hands in the put-through deals. Losers outnumbered gainers by 191-70, and 64 stocks unchanged.

There were some buying and selling waves seen in this bourse today, however, the buyers took control of the market. Buying interest was not very strong, just enough to pare the market loss. The positive thing is demand rose at the end of trading session.

HBB was the most active stock on the bourse with 2.5 million shares traded, closing flat at VND8,000 on average.

VND ranked second in the list with 2.4 million shares traded, closing down 0.7 % to VND13,500.

THV was in the third place with 2.3 million shares traded, closing down 2.9% to VND10,000. – Stoxplus.com

Tags: vietnam stock, Vietnam stock market, VNindex