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Shares to see technical recovery this week
The market is expected to see a technical recovery this week and investors are advised to stop panic selling, experts said.
PetroVietnam Gas JSC (GAS). GAS was down 3.8 per cent last week. — VNA/VNS Photo
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Shares collapsed last Friday, falling to fifteen-month lows as a series of large-cap stocks plunged to their floor prices, suffering strong selling pressure throughout the trading session.
The market benchmark VN-Index on the Hồ Chí Minh Stock Exchange (HoSE) closed Friday at 1,177.99 points, suffering a severe decline of 4.5 per cent.
Việt Nam's stock market ended the trading week with a large-scale sell-off, making the VN-Index drop by nearly 56 points, wiping out the gain of the previous 4 trading weeks combined.
“The effort of cash flow at the support areas was not enough to absorb the supply, so the market gradually dropped and plummeted at the end of the session," said Việt Dragon Securities Co.
"Liquidity increased to a record high, showing that the cash flow was also taking advantage of low prices but the market's bearish inertia was still overwhelming which made it close near the session low.
“As the market has also dropped sharply in a short time, it may temporarily be supported at 1,160-1,170 points and recover technically to re-explore supply and demand. Therefore, investors need to be cautious and manage the portfolio properly.
“At the same time, it is advisable to consider the recovery spans in the coming time to take profits and reduce the weight, prioritising stocks that have shown distribution and weakening signals, to minimise risks for the portfolio.”
Last week, Vingroup (VIC) fell 7.9 per cent and VHM fell 6.7 per cent. These are the two stocks that fell the most on the market. They were followed by large-cap stocks such as BIDV (BID) down 5.4 per cent, VPBank (VPB) down 6.4 per cent, Masan Group (MSN) down 6.5 per cent, PetroVietnam Gas JSC (GAS) down 3.8 per cent.
Meanwhile, FPT Corporation (FPT) gained 4.3 per cent and SSI Securities (SSI) gained 0.5 per cent, the only two stocks in the VN30 basket that supported the market.
During the week, foreign investors continued to net sell VNĐ987 billion, up 34.7 per cent compared to the previous week on HOSE.
“In my opinion, the correction of the market has been predicted before. Thankfully, Saturday and Sunday were the times for investors to regain their composure,” Đinh Quang Hinh, Head of Macroeconomics and Market Strategy Department of VNDirect Securities Corporation, told Việt Nam News.
“Therefore, we expect the market to see a technical recovery next week and investors should stop panic selling. Investors should wait for technical recoveries to lower the proportion of stocks instead of selling off in strong decline sessions. The zone of 1,150 - 1,170 points will be a strong support for the VN-INDEX.
“In the medium term, we maintain a positive outlook on Việt Nam's stock market with the following strong supporting factors: low interest rates; promoted public investment, stimulated consumption such as reducing taxes and fees, increasing base salary, recovery trend of the economy and profits of listed companies in the last months of the year.
“For investors who are keeping a high proportion of cash, this adjustment can bring a "good buying point" for investors to accumulate and build a portfolio of stocks for medium and long-term goals.”
At present, the market had fallen sharply in a short time, so it might temporarily be supported at 1,160- 1,170 points and technical recovery to re-explore supply and demand, said Việt Dragon Securities Co.
“Therefore, investors need to be cautious and manage the portfolio appropriately. At the same time, consider the recovery spans in the coming time to take profits and reduce the proportion, giving priority to stocks that have shown distribution and weakening signals, to minimise risks for the portfolio,” it said.
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