Daily Market Recap November 19, 2024

Vietnam stock market plunges further amid foreign investors exodus

Foreign investors are souring on Vietnam’s stock market, selling a record amount of shares amid concerns that the country may be subject to Trump’s tariff, hurting trade and foreign investment and the DXY dollar index remains elevated above 106 putting pressure on the VND (See our macro note). Domestic institutions failed to provide sufficient support, causing the VN-Index to plummet 1.0% to the 1200-point level.

The significant decline in large-cap stocks today completely wiped out the gains from yesterday’s buying spree at the bottom. The VN-Index lost nearly 12 points to close at 1,205.2, driven by foreign net selling of VND1.7tn (USD67mn). Furthermore, liquidity on the HOSE hit a two-week low. The afternoon session witnessed a continuous downward trend, with the VN-Index closing at its lowest point . The number of declining stocks surged to 380 on HOSE and the HNX, compared to 291 in the morning session.

Selling pressure intensified in the afternoon, with HOSE liquidity rising by 74% compared to the morning session, reaching VND7.2tn (USD283mn). The market breadth narrowed significantly, and the number of sharply declining stocks increased substantially, indicating that sellers had complete control over prices and continuously pushed them down. The velocity of the selling was so high that barely any sector was spared. Even sea transport and industrial property stocks, which had previously been perceived as beneficiaries of the policies of the new US administration, were hit particularly hard today. Sea transport stocks such as HAH (-6.8%) and VSC (-6.7%) and industrial property stocks like SZC (-6.0%) and VGC (-6.0%) experienced significant declines.

Blue-chips played a major role in dragging down the VN-Index, exacerbating the pessimistic sentiment. FPT declined by 3.0%, VCB by 1.1%, HPG by 1.4%, GAS by 1.6%, and VPB by 1.1%. The initial, less significant declines in these stocks in the morning session had created a sense of security. However, as the benchmark index continued to fall due to the pressure from these blue-chips, fear set in, and selling pressure spread across the board.

Foreign investors continued to be net sellers, offloading VND1.5tn (USD59mn) on the HoSE. VHM (-VND342bn; USD13.9mn), FPT (-VND312bn; USD13.1mn), HDB (-VND208bn; USD8.0mn) and HPG (-VND131bn; USD5.2mn) bore the brunt of the selling pressure. Foreign investors pulled out nearly VND11.0tn (USD433mn) from the beginning of November, significantly undermining the VN-Index’s short-term performance. Domestic institutions have been net buyers, but their efforts to offset foreign selling with net purchases of VND2.3tn (USD91mn) month-to-date have been insufficient.

The sharp decline in the afternoon session suggests that the previous day’s rebound was not sustainable. Liquidity was significantly lower, indicating that demand was only interested in very low prices.

Read the full report: HERE