Shares slump after late sell-off

A share sell-off on the HCM City Stock Exchange drove the VN-Index down to 486.71 points, a decline of 1.06 per cent. — VNA/VNS Photo Pham Hau

HA NOI — A sell-off in the final minutes of yesterday's session on the HCM City Stock Exchange drove the VN-Index to a close of 486.71 points, a decline of 1.06 per cent – with the prices of 172 out of 255 listed stocks slumping by the end of the day.

The value of trades remained sluggish, at VND1.2 trillion (US$62.6 million), with 41.35 million shares changing hands. Thanh Cong Textile & Garment (TCM) continued to see the highest number of trades, with a volume of 1.3 million shares.

"Profit-taking rose to a climax during the first 30 minutes of the continuous trading phase, with bunches of sell orders in the low-priced zone," said veteran investor Duong Yen Quynh.

The amount of money injected to cover cheap stocks became significant once the Index fell as low as 484 points, Quynh said, focusing on a few shares like Alphanam (ALP) and Vinafco (VFC) which rose nearly to their ceiling prices and helped stave off further declines in the Index.

ALP yesterday announced earnings of VND163.2 billion ($8.4 million) in the second quarter, almost tripling its earnings in the same quarter of last year. The company has estimated a profit of VND30.1 billion for the quarter, a four-fold increase over 2009. Meanwhile, VFC has decided to offer its shareholders VND150 billion ($7.7 million) worth of convertible bonds, with an 8-per-cent yield.

"Purchasing power at 484 points remained steady to the end of session, hinting that 484-485 could be a new supportive zone for the VN-Index," said Nguyen Ngoc Truong Son, head of the brokerage department of a HCM City-based securities company.

Son estimated that capital pumped into the market once the Index dived to 484, until the end of session, totalled about VND193 billion ($9.8 million). "This helped the Index avoid hitting rock bottom," he said.

The heavy sell-off early in the session also suggested that investors were despairing towards the market situation, Son said. "They accepted to cut their losses at low prices after waiting for a long time for a brighter situation."

On the Ha Noi Stock Exchange, the HNX-Index extended its run of gloomy days by slipping below 150 points, dropping 1.74 per cent to close at 147.86. Volume on the northern bourse reached only 31.25 million shares, worth a combined VND814.08 billion ($41.7 million), a slight increase over the previous day's levels. — VNS