HANOI: The market sent out mixed signals on the last day of 2015 when shares on Viet Nam’s two stock exchanges moved in opposite directions. The benchmark VN-Index on the HCM Stock Exchange inched down 0.1 per cent to close Thursday’s session at 579 points, ending a four-day rising streak. The Index climbed 6.1 per cent in 2015, making it the fifth fastest growing market in Asia.
However, on the smaller exchange in Ha Noi, the HNX-Index edged up 0.9 per cent to end at nearly 80 points. However, it lost 3.6 per cent during the whole year. According to Tran Duc Anh, an analyst at Bao Viet Securities Company, Viet Nam’s stock markets had relatively good growth in 2015, but the momentum was strongly driven by large-cap shares, while midcap and penny shares performed quietly.
On Thursday, the performance of blue chips was mixed. Dairy giant Vinamilk (VNM), Sacombank (STB), Military Bank (MBB) and private equity firm Masan Group (MSN) advanced, but insurer Bao Viet Holdings (BVH), Vietcombank (VCB), Bank for Investment and Development of Vietnam (BID) and VinGroup (VIC) declined.
Energy stocks continued to fall due to the negative movement of global oil prices. Both, Brent crude and West Texas Intermediate (WTI) crude, went down 3.5 per cent on December 30, trading at around US$36 per barrel.
Large-cap energy companies including PV Gas (GAS), PetroVietnam Drilling and Wells Service (PVD), and PetroVietnam Drilling Mud (PVC), in addition to PetroVietnam Technical Services (PVS) and PetroVietnam Coating (PVB), decreased between 0.6 per cent and 1.5 per cent.
“This group of stocks is still highly risky because of unpredictable fluctuations in the global oil market,” Anh said. The fall on the VN-Index on Thursday was attributed to a technical correction after four consecutive rising sessions, Anh said, especially when the market entered the New Year holiday on Friday, which prompted investors to sell shares to lock in cash profits.
The overall liquidity remained modest, with just a combined 173 million shares worth VND2.62 trillion ($116.5 million) being traded on the two exchanges on Thursday.
Foreign investors ended December as net sellers in Viet Nam with capital outflows recorded at nearly VND2 trillion ($89 million). However, they were still net buyers for the whole year with total investment of over VND3 trillion ($133.5 million), down 20 per cent from 2014 and being at the lowest level since 2012.
Foreign investors bought local shares strongly in the first half of 2015, but they began to withdraw capital in August and September just when China devalued its currency, and in the following months to prepare for the first US interest rate increase in the last 10 years.
According to many stock analysts, 2016 will be a challenging year for the domestic stock market and the forex risk could continue to negatively affect foreign investment inflows. However, the signing of Trans Pacific Partnership (TPP) and the regulation that eases foreign shareholdings in local companies together with other support policies are expected to keep the markets in stable development mode.