Vietnam stock market on a sideways trajectory

The Vietnamese stock market appears to have turned stagnant, with low liquidity and no short-term prospects of attracting new buyers.

Vietnam’s benchmark VN-Index, which represents the Ho Chi Minh Stock Exchange (HoSE), dropped to 1,023 points on Monday from 1,042.6 points at the end of last week, and then recovered gradually in the following sessions. It closed the week at 1,046.8 points, a slight increase of 0.16% from the previous Friday.

On the Hanoi Stock Exchange, the HNX-Index increased by 1.25 points, or 0.61%, against the previous Friday.

This week, MSN of Masan Group, BID of major bank BIDV, SAB of Saigon Beverages Co., and GAS of gas company PV Gas had the most negative impacts on the VN-Index. MSN alone fell more than 1.9 points.

On the other side, VHM, VPB and KDC of real estate firm Vinhomes, VPBank, and KDC of food producer Kinh Do had the most positive influence.

Foreign investors increased their transactions with a net buying value of VND384.32 billion ($16.34 million).

The market gained very slightly this week, but SHS Securities is of the view that the market will not return to a short-term uptrend period.

The firm said it believes this is understandable because after a strong downtrend, the market has experienced a period of technical recovery from the beginning of the year and is moving towards a balance.

"Over the past six weeks, the VN-Index has changed very little and trading volume has fallen. These are typical signals of an accumulation process. The period of movements in a narrow range with low volumes like now may continue until the market forms a new uptrend," SHS said.

Vietcombank Securities argues that in the current situation, investors should closely observe the market in the range of 1,035-1,040 points. If there is some good accumulation and the cash flow increases again, they may consider buying stocks showing double-bottom signals in industries like oil and gas, securities, and real estate, but caution is also needed.

According to MBBank Securities, the market is likely to remain flat for another week. Technically, the area of 1,050 points could be a resistance zone in this technical recovery period, it noted.