Shares bounced back slightly in the afternoon trade but the VN-Index still lost 60.94 points, or 5.11 percent, closing the January 19 session at 1,131 points.

 

This was the biggest daily retreat of Vietnam’s benchmark since the first quarter of 2020 and the second falling day this week. It inched down just 0.2 percent on January 18.

 

On the Ho Chi Minh Stock Exchange, overall market breadth was pessimistic with 394 stocks falling, only 42 rising and 39 closing flat.

 

Blue chips were the main drag when all of the top 30 largest shares by market value and liquidity (VN30) plummeted, of which eight hit the floor price of a 7-per-cent drop. All of them were banks and financial companies including BIDV (BID), Vietinbank (CTG), Military Bank (MBB), VPBank (VPB), Sacombank (STB), Ho Chi Minh Development Bank (HDB), Saigon Securities Inc (SSI) and Hoang Huy Investment Financial Services (TCH).

 

Except Vincom Retail (VRE) rebounding near the reference price by the end of the session, others lost more than 2 percent.

 

Liquidity hit a record of more than 986 million shares worth 20.4 trillion VND (879.3 million USD), up 19 percent in volume and 32 percent in value compared to January 18’s figures.

 

According to MB Securities Co (MBS), the fact that many stocks in the VN30 dropped was a bad sign which was driven by surging profit-taking pressure from investors, especially who use high leverage to buy stocks and stock prices had increased fervently in the recent uptrend.

 

Besides, many attempts to make sell orders of investors were blocked due to the stock exchange’s systematic problems while investors tried to cash in at all costs.

 

Before the January 19 session, the VN-Index rose nearly 8 percent since early January. Looking back to 2020, the market was on an uptrend since August and the VN-Index has gained nearly 50 percent from 798 points seen on August 20 to 1,191 points on January 18.

 

MBS analysts reckoned pessimistic trading on January 19 would take the market some time to stabilise and recover and the VN-Index may retest the support zone of 1,033-1,064 points before another strong recovery appears.

 

“Normally, fast and steep declines will not last long but only 1-2 sessions. Stocks that were sold at the floor price will soon bounce back as soon as the market is stabilised,” they wrote in a market report.

 

On the Hanoi Stock Exchange, the HNX-Index decreased 2.81 percent to end at 224.02 points.

 

Nearly 281 million shares worth 4 trillion VND were exchanged in the northern market.

 

Thus, the total trading value on the two exchanges reached 24.31 trillion VND (1.05 billion USD) on January 19.

 

Foreign investors were net buyers in the two markets with total net buy value of 140 billion VND./.