Foreign investors net sellers for 3 weeks on Vietnam stock market

Vietnam’s stock market has recorded foreign investors as net sellers over the past three weeks to the tune of VND3.11 trillion ($131.7 million) on the Ho Chi Minh Stock Exchange (HoSE), the country’s main bourse.

The HoSE witnessed foreign investors’ net selling of up to VND1.4 trillion ($59.2 million) on Friday, the highest in a single day so far this year.

The country’s benchmark VN-Index closed Friday at 1,138.07 points, up 1.6% compared to the previous week. In contrast, the Hanoi Stock Exchange’s HNX-Index decreased 0.66%.

This week, the transaction value on HoSE totaled almost VND77.62 trillion ($3.28 billion), down 6.3% compared to the previous week. The HNX liquidity dropped 2.2% to almost VND8.06 trillion ($341 million).

Notably on Friday, the VCB stock of Vietcombank soared with a margin increase of 4.3%, its peak in the year to date. This stock recorded more than 1.05 shares changing hands Friday, its record high in the last 10 trading sessions.

Recommendations

The market has been shaky in recent sessions and is accumulating prior to the 1,150-point resistance level, according to broker Saigon-Hanoi Securities (SHS). Short-term investors should maintain their portfolio and limit chasing high prices in gaining sessions.

Mid- and long-term investors can take advantage of the corrections to increase their proportion, and they should choose leading stocks with good fundamentals and potential for growth, SHS says.

From a technical point of view, Vietcombank Securities (VCBS) assesses that the demand from many large-cap stocks helped the VN-Index gain at the end of the week, approaching the peak area of 1,140 points. The index still needs more gaining sessions with good demand to get out of the resistance zone and head to the 1.170-point area.

On the contrary, if the selling pressure increases again at the psychological point, it is highly likely that the market will have some stronger correction, VCBS says.

Broker Viet Dragon Securities (VDSC) says the market is expected to re-test the range of 1,140 - 1,145 points, and this area may temporarily put a lot of pressure on the market. Therefore, investors need to observe supply and demand movements.

VDSC says it is necessary to consider the possibility of a recovery to take profits or reduce the proportion of stocks that have increased rapidly toward the resistance zone or are under selling pressure from the resistance zone.

Similarly, securities firm KB Securities (KBSV) recommends investors take partial profits at stocks that are approaching notable resistance areas and only buy back a certain portion.

From a more optimistic perspective, Agriseco Research believes that with the closing at the highest level of the week and good cash flow (the number of green stocks is twice the number of losers on HoSE), the market is likely to conquer 1,140 points next week and get ahead to 1,150 - 1,160 points.

According to this team, investors may continue to hold and buy stocks of firms operating in the sectors of construction, building materials, retail, livestock, export, and industrial real estate even when the market sees adjustments.