Stocks are expected to recover strongly.

VN-Index ended last week up more than 20 points, making securities companies optimistic that the market will soon head towards the resistance zone of 1,100 points.

In the last trading session of the week, the index representing the Ho Chi Minh City Stock Exchange maintained its green color and closed at a 4-month high of 1,090.84 points. Market liquidity also reached a six-month high of over VND18,300 billion, an increase of nearly VND5,000 billion compared to the previous session.

VNDirect's analysis team used the word "explosive" when describing the trading performance on June 2. The market was led by banking stocks, helping the VN-Index break out of the strong resistance level around 1,080 points with large liquidity. This shows that an upward trend is gradually forming.

Overall, the VN-Index increased by more than 20 points last week, reaching more than 1,092 points at one point. The market's stable recovery wave is clearly demonstrated through each increase followed by cumulative adjustments. According to statistics from Vietcombank Securities (VCBS), last week, the securities and chemical stocks attracted the best demand with increases of 8.3% and 6.5%, respectively.

The above developments have made investors excitedly discuss a new uptrend season (overall price increase). In the short term, securities companies have also unanimously given positive forecasts. VNDirect, VCBS, BIDV Securities (BSC), KB Securities (KBSV) and Saigon - Hanoi Securities (SHS) all said that the market is likely to increase and move towards the resistance level of 1,100 points in the coming sessions.

According to VCBS, the State Bank continues to reaffirm its monetary policy in response to the actual context. In recent months, with the goal of stabilizing the exchange rate when inflation shows signs of slowing down, the State Bank has reduced operating interest rates three times, bringing the average interest rate for new loans down by about 0.9% compared to the end of 2021. Therefore, this analysis group expects that lending interest rates have room to decrease further, although with a certain delay.

More cautiously, SHS believes that recent macroeconomic information is still mixed with positive and risky. This unit noted that the purchasing managers' index (PMI) in May fell to 45.3 - the lowest level since September 2021, when output and new orders fell sharply. This shows that the impact of the global economic growth slowdown is negatively affecting domestic enterprises.

At the same time, the Government has actively proposed solutions to ease difficulties in the corporate bond and real estate markets, but they need more time to take effect. The increase in personal consumption expenditure in the US in April has also increased concerns that the US Federal Reserve (Fed) will continue to raise interest rates in mid-June.

"With the characteristic of a market of expectations, it is also possible that stocks react earlier than reality," this unit stated.

According to SHS's overall view, the market has shifted from cautious to positive. In the short term, VN-Index maintains a strong recovery trend towards the resistance zone of 1,100 points and further around 1,150 points. This trend also creates expectations of a medium-term uptrend if VN-Index continues to surpass the 1,150 point zone. On the contrary, the support level of the above index will revolve around the 1,000-1,050 point area.

KBSV also believes that the VN-Index has a bright future, but will soon face pressure to shake again when approaching the notable resistance level around 1,100 points. Therefore, this analysis group recommends that investors should take partial profits at high prices with stocks that have experienced a strong recovery from the bottom or are approaching notable resistance zones. Investors should only buy back a portion of the proportion during correction sessions, returning to the support zone afterwards.

For short-term investors, according to KBSV analysis team, it is still possible to take advantage of market corrections to increase the proportion of stocks. Meanwhile, VCBS recommends only disbursing an additional 20-30% compared to the volume of stocks currently holding with profits and available in the portfolio.

Siddhartha

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