HÀ NỘI – Vietnamese shares extended losses yesterday as energy stocks were pulled down by a slide in oil prices and foreign investors increased selling of large-cap stocks on expectations of a US interest rate hike at year’s end.

The benchmark VN Index on the HCM Stock Exchange (HoSE) lost 1 per cent to finish at 678.02 points, marking a three-day decline totaling 1.6 per cent.

The HNX Index on the minor Hà Nội Stock Exchange (HNX) closed at 82.88 points, down 1.6 per cent from Friday. The northern market index has recorded a loss of 3.1 per cent in the last three sessions.

The common VNX Allshare Index, which tracks 450 stocks, dropped 1.1 per cent to end at 988.55 points with more than 60 per cent of the total stocks registering losses.

The energy sector was the worst hit yesterday after oil prices slid from a near four-month high on Iraq’s announcement that it would not participate in a production cut planned by the Organisation of Petroleum Exporting Countries (OPEC).

US crude West Texas Intermediate (WTI) inched down 0.2 per cent to trade at US$50.77 a barrel after falling from a four-month high of $51.60 a barrel late last week.

Meanwhile, foreign investors increased selling on both local exchanges, targeting blue chips, in order to claim profits after analysts pointed out a high chance of a US interest rate increase at year-end, which made Việt Nam’s central bank raise its reference mid-point rate for local currency-exchange trading by VNĐ13 to VNĐ22,032 a dollar.

Foreign investors on HoSE recorded a net sell value of nearly VNĐ32 billion ($1.42 million), an increase of one-fifth from Friday. On the HNX, foreign investors reduced their net buy value by 73 per cent to VNĐ3 billion.

The largest stock by market capitalisation, dairy producer Vinamilk (VNM), was the most sold by foreign investors, falling 2.2 per cent despite an earning report indicating third-quarter and nine-month profits increased by 19.2 per cent and 27.6 per cent year on year.

“The market did not react positively to good third-quarter earnings reports, thus blue chips started declining,” BIDV Securities Corp (BSC) wrote in a note.

“This reaction proves that VN Index may continue to fall in the next session because the market lacks stocks with better-than-expected business news which could lift investor confidence.”

"But nearly-unchanged market trading liqudity in recent trading days means there is a small opportunity for a sell-off, which could be a factor in stabilising investor sentiment," BSC said.

On the bright side, the Bank for Investment and Development of Việt Nam (BID) advanced 0.3 per cent after the bank on Friday announced it would pay a total dividend of VNĐ2.9 trillion in cash to shareholders, ending public concerns in recent months over the bank’s plan to pay dividend in bonus shares to increase its chartered capital.

Several steel producers, including Tiến Lên Steel JSC (TLH) and Nam Kim Steel JSC (NKG), also advanced after reporting higher profits in the last quarter compared to the same period last year.

More than 167.8 million shares were traded, worth nearly VNĐ2.9 trillion. These figures were nearly unchanged from last week. – VNS