Local stocks retreat following falling oil prices

The benchmark VN Index on the HCM Stock Exchange fell 0.9 per cent to close at 537.73 points and the HNX Index on the Ha Noi Stock Exchange dropped 1.1 per cent to end at 75.51 points. - VNS Photo Gia Vi

The benchmark VN Index on the HCM Stock Exchange fell 0.9 per cent to close at 537.73 points and the HNX Index on the Ha Noi Stock Exchange dropped 1.1 per cent to end at 75.51 points.

Oil prices yesterday continued to fall near their twelve-year lows after Iraq announced a record output last month and planned to raise production this year.

benchmark crude West Texas Intermediate (WTI) dropped 0.8 per cent to trade at VND672,462 a barrel while London-traded Brent crude lost 0.9 per cent to trade at VND675,365 a barrel.

WTI crude price has slid 6.5 per cent over past two sessions since a two-day rally of 21 per cent from its twelve-year low touched last Wednesday, while Brent crude price has slipped 6 per cent after gaining 15.4 per cent.

In addition, investors were looking forward to the decisions made by the United States (US) and Japan's central bank whether they should implement easing policies on the economies.

These two factors were the main reasons that dragged down investor confidence in local stocks yesterday.

The plastic sector index lost 3.9 per cent, led by Binh Minh Plastic JSC (BMP), which dropped 3.3 per cent, and Tien Phong Plastic JSC (NTP), which slumped 5.2 per cent.

Other large-cap stocks that also helped pull down the markets included dairy firm Vinamilk (VNM), insurer Bao Viet Holdings (BVH), and Vietcombank (VCB), which fell 2.5 per cent, 2 per cent and 2.6 per cent, respectively.

On the other side, PetroVietnam Gas Corporation (GAS), the Bank for Investment and Development of Viet Nam (BID), and Vietinbank (CTG) lifted the market. They gained 3.8 per cent, 3.1 per cent and 1.2 per cent, respectively.

Yesterday, Viet Nam's central bank cut its reference mid-point rate for exchange trading band by VND12 to VND21,898 for a US dollar.

Both local markets traded more than 183 million shares worth VND2.2 trillion (VND2,188,683 million), a decrease of 24 per cent from Monday's trading value.