Trade wars, quarterly earnings to keep VN stocks down in September

The market sentiment will remain lateral in September weighed down by global economic and political tensions while trading quiet amid speculations of Q3 corporate earnings.

Trade wars, quarterly earnings to keep VN stocks down in September
A female investor watches stock prices on a desktop. Vietnamese shares are predicted to remain quiet in September under pressure of the trade wars. - Photo tinnhanhchungkhoan.vn

The US-China trade war was taken to the new level on Sunday after China and the US announced tariffs imposed on each other’s products.

Even comments from US President Donald Trump about the continuance of new trade talks cannot clear the cloud that has overshadowed the global markets in recent months.

Political and economic tensions in other areas of the world such as the East Asia (between Japan and the Republic of Korea) have also cautioned investors in Viet Nam about the global economic recession.

The benchmark VN-Index on the Ho Chi Minh Stock Exchange gained 0.56 per cent to close last week at 984.06 points but it dropped total 0.84 per cent last week.

The VN-Index has struggled to rise in total as much as 5.82 per cent since June 27. It has failed to conquer the 1,000-point level three times.

On the Ha Noi Stock Exchange, the HNX-Index increased 0.37 per cent to end at 102.32 points, totaling a weekly loss of 0.90 per cent.

The market is in negative shape and is too dependent and driven on the international developments, according to Phan Dung Khanh, director of investment consultancy at Maybank Kim Eng Securities.

Worries about the global economy and stocks have triggered stronger foreign selling in recent weeks, putting more pressure on the Vietnamese market, Khanh told tinnhanhchungkhoan.vn.

Last week, foreign investors net-sold total VND130 billion (US$5.6 million) worth of Vietnamese shares. Net foreign selling in August touched VND1.73 trillion, which was a back step compared to July’s net foreign purchase of VND2.24 trillion.

The US-China trade war clearly has impeded the foreign capital flowing into Viet Nam’s market in recent weeks. Plus the decline of trading liquidity, “Vietnamese shares will remain quiet in the coming weeks if there are no improvements in those factors,” he said.

 

An average of more than 187.6 million shares was traded in each session of last week, down 4.5 per cent from the previous week.

According to Viet Dragon Securities Co (VDSC), core inflation has caught up on the Government’s target of 2 per cent for 2019, therefore, it is unlikely investors will be able to seek financing for their purchases in the remaining months.

In addition, the central bank’s monetary tightening policy towards the sectors with high demand of long-term capital such as realty has made corporate bond market, which has average per annum yield rate of 11-14.5 per cent, become more attractive to investors than stocks.

The US-China trade war and its potential risks on the global economy also press investors to escape from stocks and find shelter in safer ones (gold, government bond and US dollar), so the market trading liquidity will unlikely increase in the future. So the VN-Index may be unable to post sharp gain.

Investors are becoming less dynamic and excited, so the market is getting quieter with stocks being hit by selling pressure, Nguyen Trung Du, director of market analysis at VNDirect Securities Corp, said.

“There is now no information that is strong enough to cushion the market sentiment and overwhelm worries about the economic recession,” he said.

“There is no clue for a positive rebound of the stock market in September and the best forecast now is the market will move sideways amid speculations about Q3 corporate earnings season,” Du said.

But it is too risky to begin hunting for companies’ stocks with expectations for good Q3 performances, Khanh at Maybank Kim Eng Securities Co said.

“The global economy is going down, Viet Nam’s economic growth is slowing, and domestic firms are being heavily weighed down by the trade war,” he said.

In the second quarter, total profit of listed firms rose only 5 per cent year on year – the lowest in five years. The number of loss-making firms accounted for 15 per cent of total listed firms and a third of total firms posted lower profits. – VNS

 
 

Other News

.
Power Development Plan VIII under revision again
Power Development Plan VIII under revision again
BUSINESSicon  13/01/2022 

The draft Power Development Plan VIII is being revised again and expected to be submitted to the Prime Minister for approval in the first quarter of 2022.

M&A in technology booms during pandemic
M&A in technology booms during pandemic
BUSINESSicon  13/01/2022 

The Mergers and Acquisitions (M&A) market in Viet Nam has been going through a downturn due to the pandemic, but the technology sector is bucking the trend.

Auction mechanism for sustainable development of renewable energy market under scrutiny
Auction mechanism for sustainable development of renewable energy market under scrutiny
BUSINESSicon  13/01/2022 

A Policy Dialogue on “Auction Mechanism for Sustainable Development of the Renewable Energy Market” was held via an online format on January 11 by independent think tank Vietnam Initiative for Energy Transition (VIETSE).

Transport Ministry proposes allowing private firms to invest in airport projects
Transport Ministry proposes allowing private firms to invest in airport projects
BUSINESSicon  13/01/2022 

The Ministry of Transport has proposed mobilizing private resources under the public-private partnership model for new airport projects, such as Quang Tri, Sa Pa and Cao Bang.

Trinh Van Quyet’s transaction canceled, securities accounts blocked
Trinh Van Quyet’s transaction canceled, securities accounts blocked
BUSINESSicon  12/01/2022 

An unreported transaction made by Trinh Van Quyet, Chair of FLC Group, worth VND1.6-1.8 trillion on January 10 has been canceled as he did not report the deal.

Tan Hoang Minh Group withdraws from Thu Thiem land auction, accepts loss of deposit
Tan Hoang Minh Group withdraws from Thu Thiem land auction, accepts loss of deposit
FEATUREicon  12/01/2022 

Tan Hoang Minh Group has sent a letter to the Party, State and Government leaders, and HCM City People’s Committee about its decision to withdraw from Thu Thiem land purchase that it won at auction in mid-December.

Land prices soar amid fear for Omicron
Land prices soar amid fear for Omicron
FEATUREicon  13/01/2022 

While affordable apartments are no longer seen in Hanoi and HCM City, apartments priced at hundreds of billions of dong are becoming popular.

Bad debts need to be curbed
Bad debts need to be curbed
BUSINESSicon  13/01/2022 

After the Circular issued by the State Bank of Vietnam on debt restructuring, many bad debts of commercial banks have become non-bad debts because they do not have to change the debt groups.

Vietnam ranks third worldwide in terms of rubber export value
Vietnam ranks third worldwide in terms of rubber export value
BUSINESSicon  12/01/2022 

Vietnam ranked third in the world in terms of rubber export value, with 3.24 billion USD in 2021, up 36.2 percent from the previous year, the Ministry of Agriculture and Rural Development (MARD) said.

China reopens one more border gate with Vietnam for fresh fruit imports
China reopens one more border gate with Vietnam for fresh fruit imports
BUSINESSicon  12/01/2022 

Chinese authority on January 12 re-opened its Hekou International Border Gate for imported fresh fruits, including dragon fruit, and frozen foods from Vietnam, according to the Ministry of Industry and Trade.

Vietnamese banks’ charter capital surged in 2021
Vietnamese banks’ charter capital surged in 2021
BUSINESSicon  12/01/2022 

Banks increased their charter capital by more than VND110 quadrillion in 2021 - the highest annual growth to date - to enhance financial strength and meet the central bank’s regulations.

VN to boost domestic 'supporting industries'
VN to boost domestic 'supporting industries'
BUSINESSicon  12/01/2022 

Vietnam is looking to work closely with foreign firms such as Samsung and Toyota to boost the supply of parts within the country, according to the Ministry of Industry and Trade.

Market potential of elderly service industry growing fast
Market potential of elderly service industry growing fast
BUSINESSicon  13/01/2022 

The increasing demand for services for the elderly has created investment and business opportunities for local and foreign investors.

VIETNAM BUSINESS NEWS JANUARY 12
VIETNAM BUSINESS NEWS JANUARY 12
BUSINESSicon  12/01/2022 

Tra fish exports predicted to hit 1.7 billion USD this year

Vietnam first Southeast Asian country to earn over US$1 billion from exports to Hungary
Vietnam first Southeast Asian country to earn over US$1 billion from exports to Hungary
BUSINESSicon  12/01/2022 

Vietnam has become the first Southeast Asian nation to earn over 1 billion USD from exporting goods to Hungary and the European country’s leading exporter from this region since 2000, according to the Ministry of Industry and Trade.

Vietnam has 683,600 operational firms: economic census
Vietnam has 683,600 operational firms: economic census
BUSINESSicon  12/01/2022 

As of December 31, 2020, Vietnam counted 683,600 operational enterprises, up 35.3 percent from 2016, the 2021 economic census revealed.

Hanoi to welcome launch of 26,000 apartment units in 2022: C&W Vietnam
Hanoi to welcome launch of 26,000 apartment units in 2022: C&W Vietnam
BUSINESSicon  12/01/2022 

Around 26,000 apartment units are expected to be launched in Hanoi in 2022, signaling a vibrant outlook for the segment, according to real estate service provider Cushman & Wakefield (C&W) Vietnam.

Laos top recipient of Vietnam’s overseas investment
Laos top recipient of Vietnam’s overseas investment
BUSINESSicon  12/01/2022 

Laos has been the largest recipient of Vietnam's overseas investment so far, with 209 projects totalling 5.1 billion USD in registered capital, Minister of Planning and Investment Nguyen Chi Dung has said.

Top 5 commodity brokers in Vietnam revealed
Top 5 commodity brokers in Vietnam revealed
BUSINESSicon  12/01/2022 

The five companies holding the largest commodity brokerage market shares in Vietnam sustained their positions in 2021, according to the Mercantile Exchange of Vietnam (MXV).

VN auto market grows slightly in 2021
VN auto market grows slightly in 2021
BUSINESSicon  12/01/2022 

Vietnam’s automobile market recorded slight growth in 2021, data from manufacturers showed.

 
 
 
Leave your comment on an article

OR QUICK LOGIN