VN-Index shows no signs of bottoming out after breaking through the 1,200 mark

The domestic stock market today (August 5) turned negative following the world's fluctuations. In Japan, the Nikkei index just experienced its worst day in nearly 4 decades, erasing all gains since the beginning of the year. Meanwhile, in Korea, the Kospi index temporarily halted trading due to a strong sell-off. Concerns about the possibility of a US recession caused investors to flee and challenged the FED to quickly cut interest rates to save growth.

On the HOSE floor, the VN-Index closed at 1,188.07 points, down 48.53 points, equivalent to 3.92%. Not a single stock in the VN30 basket remained above the reference level. The blue color spread across the electronic board.

Technically, analyst Nguyen Phuong Nga - Vietcombank Securities Company - found that most indicators are pointing down, along with DI- and ADX rising, showing that the market is still under strong selling pressure and has not yet shown signs of forming a bottom. The phenomenon of margin calls from many accounts also increased the negative impact on the market. VN-Index may soon have a recovery when it reaches the strong support zone around 1,180 points.

Expert Nguyen Le Nguyen Vi - DSC Securities Company - said that VN- Index is retreating to the lower limit of the wide sideway zone. With a purely psychological decline like this, it is difficult to say exactly whether the old support is really reliable or not. If the market stops falling around here until the end of the week, the 1,170 - 1,180 point mark will truly become a strong support zone.

"When stocks are sold off like today, value will rise again, especially large-cap stocks, which will receive close attention from large cash flows. Short-term investors should not sell off, but should proactively reduce their borrowed capital, only holding portfolios bought with principal. Long-term investors should gradually buy according to the index's downward trend, prioritizing large-cap stocks and industry leaders," the expert said.

Looking at the broader context of August, the picture of second-quarter profits of listed enterprises has gradually improved and shown positive signs. Statistics estimate the increase to be about 25.6% compared to the same period in 2023 and 12.8% compared to the previous quarter. Experts from Rong Viet Securities Company (VDSC) believe that positive factors supporting the market in the coming period include the FED's likely reduction of interest rates at its September meeting, thereby reducing pressure on exchange rates and net withdrawal pressure from foreign investors. The macro economy continues to recover, with positive export activities. Policies such as reducing VAT and increasing basic salaries for the public sector can help stimulate consumer demand.

"With profit growth in the second quarter and positive prospects in the coming quarters, the P/E for 2024 of VN-Index is estimated at 11.7 times, relatively attractive when lower than the average of 13.7 times in the past 5 years. The potential investment portfolio in August 2024 will include priority businesses with expected good growth in business results in the second half of 2024, reasonable valuations, or in industries that benefit from policies supporting the economy" - VDSC assessed.

Source: https://laodong.vn/kinh-doanh/vn-index-chua-thay-tin-hieu-cham-day-sau-khi-thung-moc-1200-1376317.ldo