Vietnam’s stock market tumbled in the final 30 minutes of trading on October 27, with sharp losses wiping out nearly $5 billion in market capitalization, raising investor concerns over rising volatility and negative sentiment across key sectors.

Sharp drop at the close

The October 27 trading session on the Ho Chi Minh Stock Exchange (HoSE) surprised many investors.

For most of the session, the VN-Index hovered around its reference level as investors remained cautious, waiting for clearer signals from market liquidity.

However, the situation turned abruptly in the last 30 minutes when intense selling pressure swept across multiple sectors.

The selling pressure hit a wide range of stocks, especially in the real estate sector, dragging down many blue-chip stocks - some even hitting their daily floor limits.

By the end of the session, the VN-Index dropped 30.64 points, or 1.82%, to close at 1,652.54 points. The market capitalization fell by nearly $5 billion.

The sell-off wasn’t limited to large-cap stocks; it spread across the board, with nearly 200 stocks declining. Trading volume surged to nearly 30.8 trillion VND (approx. $1.25 billion) on HoSE.

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Vietnam’s stock market faced a sharp decline on October 27. Photo: HH

The VN30 Index, which represents 30 leading stocks, posted an even steeper loss, falling 43.84 points (2.25%) to 1,900.76 points - moving further away from its previous peak above 2,000 points.

The “Vin” group led the decline, with Vinhomes (VHM) and Vincom Retail (VRE) both plunging to their floor prices (-7%) with millions of shares left unsold. Vingroup (VIC) lost 2.28%, pulling the broader index down.

Other real estate stocks such as DIG, CEO, KDH, NVL, and TCH also fell sharply, with average losses ranging from 3% to 7%.

Banking and securities stocks - two key pillars of the market - were not spared. Stocks like TCB and VPB experienced steep declines, further weighing down the VN-Index.

Within the VN30 basket, only five stocks posted modest gains: DGC (+0.5%), FPT (+0.31%), GVR (+3.2%), SAB (+0.7%), and STB (+0.15%).

One stock (ACB) remained unchanged, while the remaining 24 stocks closed in the red.

This divergence shows that capital flow concentrated in a few “safe havens” like technology (FPT) and consumer goods (SAB), but was not strong enough to offset the widespread sell-off in real estate and blue chips.

In stark contrast to Vietnam’s market downturn, Asian stock markets surged to new highs.

Japan’s Nikkei 225 surpassed the 50,000-point milestone for the first time, rising nearly 2.5%. South Korea’s Kospi broke through 4,000 points (+2.6%), Hong Kong’s Hang Seng rose 1.1%, and China’s CSI 300 added 1.2%.

These rallies were driven by optimism over the removal of U.S.-China tariffs and expectations that the U.S. Federal Reserve (Fed) would cut interest rates, boosting global investor sentiment.

Contributing factors

The sell-off in Vietnam’s stock market came amid otherwise stable macroeconomic conditions, with solid growth and Vietnam’s global standing remaining strong.

However, concerns in the financial sector may have triggered the sharp drop.

Liquidity pressure has been building in the banking system. Between October 20-24, the State Bank of Vietnam (SBV) injected more than 72.8 trillion VND (approx. $2.96 billion) via open market operations (OMO), bringing total OMO liquidity to nearly 223.5 trillion VND - nearing the record high of 225 trillion VND reached in July.

OMO rates remained at 4% per annum, but demand for overnight borrowing from banks spiked.

Interbank overnight rates remained elevated, hitting 5.81% on October 23. This increase in capital costs for banks can ripple through the broader economy, creating systemic pressure.

Meanwhile, the SBV continued to sell foreign currency via forward contracts at an exchange rate of 26,550 VND/USD.

Another pressure point came from continued net foreign selling.

On October 27, foreign investors net sold approximately 1.2 trillion VND (approx. $49 million). For the previous week, the figure was 4.7 trillion VND (approx. $191 million), mainly targeting banking and securities stocks.

Analysts noted that foreign investors tend to react quickly to global risks and exchange rate fluctuations.

Moreover, the stock market is entering a lull following the Q3 2025 earnings season.

While some sectors - such as banking, real estate, and brokerage - reported strong earnings, investors remain cautious due to high margin usage and currency volatility.

Several securities firms forecast that the VN-Index may continue to fluctuate between 1,650 and 1,700 points before establishing a new trend.

The market needs capital to flow back into sectors with strong Q4 prospects, such as technology, steel, or real estate.

However, the lack of short-term catalysts may weigh on investor sentiment in the near term.

Manh Ha