A few days ago, many individual investors were still feeling depressed as domestic stock trading was increasingly gloomy, liquidity was at a record low and stock prices were continuously falling. However, after the explosive session last weekend, investors were overwhelmed with emotions, hoping that the decline had ended and the market would return to an upward wave in line with the economic recovery.
"Untie" personal cash flow
The highlight of the stock market last week was the weekend session that stopped the VN-Index from falling for five consecutive weeks. Order matching liquidity on the HSX reached over 917 million units, more than double the previous session and 50% higher than the average level of the last 20 days.
Many investors are more optimistic about the current stock market. Because a "follow-the-moment" session - the market increases in both points and liquidity and spreads across industries, leading stocks appear to attract cash flow... - helps them expect the VN-Index to end its losing streak and go up.
Mr. Nguyen The Minh, Director of Analysis - Yuanta Securities Vietnam, commented that after the sudden crash in early August, most major stock markets in the world recovered and soon regained their old peak. Meanwhile, Vietnamese investors are still cautious. By the trading session last week, large cash flows from institutional investors officially entered the market with stocks in the securities and real estate sectors, helping the VN-Index break the 5-week downtrend.
"The nature of the downward adjustment in recent weeks is due to investors being swept away by negative sentiment from the sell-off in the international market. The important thing is that the domestic macro economy is still very good. After the explosive session last weekend, the market is likely not to be able to go up immediately but to accumulate around the current level, then start to confirm the uptrend when more money flows in," Mr. Minh said.
Mr. Truong Hien Phuong, Senior Director of KIS Vietnam Securities Company, said that the large cash flow in the trading session last weekend showed that institutional investors and foreign investors had returned. With a liquidity of more than 1 billion shares and a transaction value of more than VND25,000 billion, it could not be the cash flow of individuals.
"The market has had a 5-week decline, the prices of many stocks have reached reasonable valuations, attracting large investors to buy, helping to "untie" cash flow and dispel the hesitation of individual investors, who account for a large proportion of the market.
Overseas, the latest signals also show that the US Federal Reserve (FED) is likely to cut interest rates by 0.5 percentage points in September 2024 - much higher than expected. If so, the investment flow in the world will reverse, no longer withdrawing from frontier and emerging markets. At this time, Vietnam is also one of the markets that will benefit" - Mr. Phuong commented.
Green has just returned to the stock market after many weeks of gloomy trading. Photo: Hoang Trieu
Foreign investors stop net selling
One of the bright spots in the stock market last week was that foreign investors returned to net buying more than VND1,000 billion on the HoSE. This is a positive signal, showing the renewed interest of foreign investors in the Vietnamese stock market, after a series of consecutive net selling since the beginning of the year.
According to Mr. Nguyen The Minh, in the context of the USD/VND exchange rate falling sharply and forecast to continue to cool down after the news that the FED may cut interest rates in September, foreign investors are net buying again. Last week, money was withdrawn from technology stocks in some Asian markets and shifted to other markets with more attractive prices, including Vietnam.
Therefore, Mr. Minh believes that foreign cash flow from now until the end of the year will be a pillar for the market. The second quarter of 2024 is usually the time when large investors evaluate and choose stocks to buy and hold for the end of the year.
A very positive factor for the stock market is that the management agency is urgently seeking comments on the draft circular regarding the removal of the requirement for foreign investors to deposit funds (pre-funding) before placing orders - the biggest bottleneck in the process of upgrading the Vietnamese stock market. A few days ago, the State Securities Commission held a meeting with depository banks, securities companies and foreign financial institutions regarding this content.
Mr. Dinh Minh Tri, Head of Analysis Department - Mirae Asset Securities Company, commented that it is likely that the circular related to removing the pre-funding bottleneck for foreign investors will be issued in September, the time when FTSE will have a review period to consider upgrading the Vietnamese stock market. It is likely that Vietnamese stocks will be considered for upgrading in 2025.
Mr. Dinh Minh Tri analyzed: "A survey we just conducted on 5 markets that were upgraded from frontier to emerging by FTSE shows that these markets all had an increase wave before the official upgrade.
The increase in points depends on the market's response, but it will trigger speculative cash flow to participate. Securities companies are rushing to increase capital to meet new standards before the Vietnamese stock market is officially upgraded.
Don't rush to buy yet.
After the "explosive momentum" stock market session last weekend, experts said the market will not increase rapidly immediately but may accumulate or fluctuate around the 1,250 point area.
Mr. Dinh Quang Hinh, Head of Macro and Market Strategy Department - VNDIRECT Securities Company, predicted that the market will soon have "shakes" when VN-Index approaches the strong resistance level at 1,260 points. Therefore, investors who "missed the wave" should not rush to buy but need to patiently wait for alternating ups and downs to buy stocks at better prices.
Regarding specific investment opportunities, investors can consider banking stocks as credit growth began to pick up again in the second half of July and valuations of this sector remain relatively cheap after the recent decline. Textile, seafood, and wood products sectors also have good prospects as exports are improving strongly.
Source: https://nld.com.vn/thi-truong-chung-khoan-vao-song-tang-moi-196240818193338741.htm
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