Investor caution advised amid continued selling pressure

Investors are being advised to take caution, narrow their portfolios and focus on specific stocks with growth potential as Vietnam’s benchmark VN-Index is likely to decline with no supporting information at home or abroad, according to securities companies.

The Vietnamese stock market had a shaky week last week (April 10-14), when selling pressure increased in the later sessions causing the main index to drop to neutral territory at around 1,055.

The VN-Index, which represents the Ho Chi Minh Stock Exchange (HoSE), fell at the start of the week but made a brief recovery in the following session. However, investor caution led to a market downturn that ran through Friday.

Ending the week, the VN-Index lost 16.21 points, or down 1.57% from the previous week, to 1,052.89, with declining liquidity. Meanwhile, the HNX-Index on the Hanoi Stock Exchange (HNX) decreased 4.35 points, or 2.06%, to 207.25.

According to Saigon-Hanoi Securities (SHS) statistics, trading value on the HoSE reached over VND64 trillion ($2.7 billion) last week, down 4.6% compared to the previous week; while the figure for the HNX was VND8.16 trillion ($348 million), a week-on-week decrease of 0.7%.

Foreign investors were net sellers for the third consecutive week with a value of more than VND1.73 trillion ($73.78 million) due to pressure to withdraw capital from the Fubon ETF.

VCB of Vietcombank, SAB of brewer Sabeco, BID of BIDV bank, GAS of PV Gas, and VIC of Vingroup had the most negative impacts on the VN-Index, of which, VCB alone knocked more than 1.8 points off the index. Meanwhile, NVL of real estate developer Novaland, MWG of Mobile World Investment Corp., and DGC of Duc Giang Chemicals were the most positive influencers.

In the past week, the market saw a strong divergence with short-term cash flow running through stock groups. The real estate group suffered the sharpest fall after weeks of gains, with LDG of LDG Investment down 17.32%, L14 of Licogi 14 10.52%, SCR of Saigon Thuong Tin Real Estate 10.13%, CEO of CEO Group 9.41%, DXG of Dat Xanh Group 6.25% and DIG of DIG Corp. 4.71%.

Securities codes were also under strong selling pressure, with VIX of VIX Securities losing 7.06%, BVS of Bao Viet Securities 7.04%, CTS of VietinBank Securities 6.82%, VCI of Viet Capital Securities 6.53%, and VND of VNDirect 6.01%.

According to SHS, the VN-Index is still heading towards a short-term recovery. The benchmark index could reach 1,150 or higher this week.

“Movements in a narrow range with low volume are likely to continue until the market forms a new uptrend," said the broker.

“Short-term investors can put money down in correction sessions when the market shows a signal of recovery towards the 1,150-point territory. They should choose stocks in leading companies with good fundamentals and those with stable growth potential that are moving in the current accumulation state,” it advised.

Meanwhile, Vietcombank Securities (VCBS) recommended investors keep a close eye on the VN-Index around the area of 1,055 points and consider buying stocks with tight accumulation in sectors such as securities, oil and gas, and electricity.

“Investors should limit early bottom-fishing when the market continues to see strong fluctuations without any clear signals of an increase in active buying power,” it said.