Investor sentiment has been clearly relieved. The bustling atmosphere has returned to all social networks, forums, and stock groups.
The Vietnamese stock market has just experienced an unexpectedly explosive trading session. The sudden cash flow into the market in the second half of the afternoon session caused a series of stocks to break out strongly. The VN-Index increased by nearly 16 points, closing above the 1,300-point mark. However, liquidity on the HoSE floor decreased slightly compared to the previous session, reaching more than VND23,200 billion.
The last time the VN-Index touched 1,300 was on June 8, 2022. However, the main index could only stay above this threshold for two sessions on June 8-9 before turning around and falling sharply, taking 2 years to return. Needless to say, we can imagine how happy stock investors in Vietnam were when the Index surpassed the barrier after many previous unsuccessful attempts. The bustling atmosphere returned across social networks, forums, and stock groups. Stock investors burst into joy when their psychology was clearly relieved.
The general market's uptrend is despite the unending selling pressure from foreign investors. Foreign investors continued to net sell nearly 600 billion VND in the session on June 12 on HoSE, the net selling value since the beginning of 2024 has officially exceeded 40,000 billion VND.
The increase of 1,23% also helped VN-Index become one of the best-performing indices in the world on the same day, going against the trend of some major markets in the region such as Japan, Thailand, Hong Kong (China). The capitalization of the HoSE floor also increased by more than 64,000 billion VND, reaching 5.3 million billion VND.
In general, it is difficult to confirm any trend because the stock market always has unpredictable variables, especially for a frontier market like Vietnam. However, there are some positive signals that can strengthen the confidence of stock investors in the coming time.
According to Mr. Bui Van Huy, Director of DSC Securities Corporation, Ho Chi Minh City Branch, the factors of the world's inter-market are still basically stable and there is nothing to worry about. The USD Index has created a short-term peak, bond yields have decreased significantly, and many major world stock indexes have set new peaks. Meanwhile, domestic pillars have maintained a positive position. Exchange rates, interbank interest rates, and some other small variables are still under control, according to Mr. Huy. With the world situation generally stable, the market can focus on the main story at this time, which is the recovery of industry groups following the economic recovery.
Sharing the same view, Mirae Asset Securities also commented that the VN-Index's uptrend is likely to continue in June, supported by a strong profit growth picture in the first quarter of 2024 and a price corresponding to the 10-year average P/E recovering to around 1,320 points.
According to Mirae Asset, the macro backdrop has not changed significantly, but instead the market is gradually warming up with information that US inflation cooled down in April, paving the way for a rate cut in September. Meanwhile, demand has gradually stabilized and is now ready for breakout sessions.
On the other hand, the medium- and long-term prospects for the stock market remain positive when looking at the big picture. SSI Securities in a recent report assessed that maintaining a flexible monetary policy and an expansionary fiscal policy in 2024 will help production, trade, investment and consumption activities recover in turn. Therefore, expectations of business results returning to growth trajectory are one of the main drivers for the stock market in the second quarter as well as the second half of 2024. In addition, measures to resolve the problem of upgrading to emerging markets by FTSE Russel will be more specific, which is also an important factor. The second half of the year is also when investors begin to set expectations for 2025 and there are grounds to believe that there will be better recoveries in the world economy and Vietnam, while risk factors will also be more evident and may have a lighter impact on the market.
However, SSI noted that in the short term, the stock market has just gone through a period of strong fluctuations from adjustment to recovery and needs time to consolidate supply and demand above the old peak. The pressure to take profits to preserve profits and reduce debt ratios as the market approaches the end of the second quarter may make it difficult for the market to break out in the short term. Therefore, keeping the proportion of stocks at a balanced level and diversifying the portfolio by industry can help investors be proactive and limit risks.
Source: CafeF
