Vietnam’s stocks plunged the most in six weeks on speculation exchange-traded funds sold shares to rebalance their investment portfolios.
The Ho Chi Minh City Stock Exchange’s VN Index sank 2.7 percent to 496.50 in the last minute of trading, the steepest decline since Feb. 26 and the biggest loss among Asian markets. The index earlier gained as much as 1.6 percent after local retailers cut fuel prices. Gemadept Corp., a shipping company, plunged 5.6 percent, the most since March 18. Vietnam Dairy Products Joint-Stock Co., known as Vinamilk, fell 2.3 percent.
“Portfolio rebalancing of index trackers caused the market slide,” said Attila Vajda, a Ho Chi Minh City-based broker at ACB Securities Co. The index surged 1.4 percent on March 15 as investors bought shares of Gemadept after the company was included in the FTSE Vietnam Index as part of its quarterly rebalancing, according to Viet Capital Securities.
The market was operating “normally” today with no technical issues, Phan Thi Tuong Tam, chief executive officer of the country’s main bourse, said by phone.
The VN Index has rallied 20 percent this year, the second-best performer in Asia after Japan, after the country’s central bank cut borrowing costs to spur growth amid slowing inflation.
Vietnam National Petroleum Corp., the largest importer of petroleum products, lowered the price of gasoline by 500 dong (2 cents) per liter yesterday after the Ministry of Finance ordered the reduction to bring local prices in line with recent declines in global markets, according to a statement on the company’s website. Petrolimex also cut prices of diesel and kerosene.
PetroVietnam Gas Joint-Stock Co., the biggest-listed company by market value, lost 2.7 percent.