Foreign investors return to net buying for fourth trading session

Foreign investors have reversed to net buying for four consecutive sessions with increasing values, offering more opportunities for investors in the Vietnamese stock market.

Last Friday, foreign investors net bought VND30 billion ($1.18 million) on the Ho Chi Minh Stock Exchange (HoSE) after 21 consecutive sessions of net selling.

On Monday, the first session of the week, they increased net purchases to VND65 billion ($2.56 million), focusing on stocks like MSN of Masan Group, CTG of VietinBank, and KBC of Kinhbac City Development Holding Corporation.

Their net buying value rose to VND228 billion ($8.98 million) on Tuesday and VND354 billion on Wednesday.

In the last six trading sessions, the benchmark index has increased nearly 37 points, with four sessions of gains and two sessions down slightly.

A similar recovery was seen on the Hanoi Stock Exchange (HNX), while the Unlisted Public Companies Market (UPCoM) recorded its fifth consecutive gaining session.

Dao Hong Duong, director of industry and stock analysis at VPBank Securities (VPBankS), commented that the recent strong rise in the DXY Index to 107, which put pressure on exchange rates, was one of the factors leading to the foreign net selling trend.

However, domestic investors remained relatively independent and did not follow the foreign net selling trend. Additionally, the market's decline was enough for foreign investors to slow their net selling and reverse to net buying.

Based on historical data measured by VPBankS across 16 sectors over the past eight years, nine out of 16 are currently trading at a P/E (price-to-earning) ratio below the 8-year average, with five approaching the lowest levels in the 8-year cycle.

In terms of P/B (price-to-book) ratio, 14 out of 16 are trading below the 8-year average, with six near their 8-year lows. Meanwhile, the P/B ratio of the VN-Index stands at 1.6x, with the lowest being 1.5x and the average being 2.2x.

"The valuation of the VN-Index has fallen well below the average and is just a bit away from the cycle low. In an attractively valued market, if foreign investors stop selling, the rebound can come quickly. This is a point investors should pay attention to in order not to miss opportunities," said Duong.

The VPBankS expert believed that the chemical, food and beverage, retail, tourism and entertainment, real estate, financial services, banking, and information technology sectors are among the most promising in the near future. These sectors are expected to see profit growth in 2025 compared to this year and are less affected by external factors, with relatively fair valuations.

Regarding real estate, although business results for the first nine months were not promising, it is still considered a favorable sector because the negative factors were already reflected.

According to Duong, compared to the low base in 2024, even a medium-sized project could bring strong profit growth for real estate companies, leading to significant price movements.

Currently, housing real estate companies are reactivating product launches to secure revenue for the next few quarters. The pressure from bond and short-term debt for listed housing real estate companies is not significant for Q4/2024 and 2025.

Meanwhile, industrial real estate faces the only issue of a supply shortage while demand remains very high. Companies in the northern region will have new supply in Q4, which will help improve revenue and profits in the near future. Accordingly, companies with new supply will have strong growth prospects, Duong concluded.