Approaching the 1,700 point mark, how far will stocks go?

Given this development, many experts predict that in the short term, stocks may face great pressure, but from now until mid-October, the VN-Index may still reach 1,800 points, or even higher.

Mr. Dinh Quang Hinh - Head of Macroeconomics & Market Strategy Department, Analysis Division of VNDirect Securities Company - commented that the market may face short-term fluctuations due to profit-taking pressure due to the high margin lending rate.

“The market has been differentiated and the score is relatively high. To determine whether the market can continue to increase or not, many factors need to be considered. In the next 2 months, if we are upgraded to a stock market, the index can completely continue its long-term increase with the goal of the VN-Index reaching the 1,800 point mark from now until October,” said Mr. Hinh.

Experts say the general trend of the market is for stocks to continue to rise. (Illustration photo).

Mr. Nguyen The Minh, Director of Research and Development of Individual Clients at Yuanta Securities Vietnam, said that in the short term, the continued increase of the stock market may still occur but is not sustainable because the market will face risks when financial pressure is quite large in the context of the market's margin level (margin trading) being very high.

“Currently, the main increase is in the banking stock group. Looking back at the valuation of this group on August 21, the book value reached 1.9 times and according to the valuation, the banking group may exceed 2.0. With the support of this group, in a few months, the stock market may reach the 1,800 point mark ,” said Mr. Minh.

According to the forecast of An Binh Securities Company, VN-Index may increase to 1,792 - 1,864 points in the medium term. If based on the growth rate of VN-Index in the period of 2020 - 2021 as a reference for the current upward trend, VN-Index may aim for the target of 1,900 points.

Experts also commented that although the long-term prospects of the stock market are still considered positive, investors need to pay attention to two variables.

First, will GDP growth reach the target after a series of economic stimulus policies have been implemented? Basically, the stock market usually leads the economic development by about 6 months. The excellent performance of the stock market in recent months is reflecting the expectation of growth to reach the target of 8.5% this year and reach even higher in 2026.

Second is the trend of inflation, some opinions say that the consumer price index may be under pressure again after the recent strong easing policies. If inflation increases, it is inevitable that interest rates will be affected, especially when the liquidity of the system is no longer too abundant because capital mobilization growth cannot keep up with credit growth.

For risky asset investment channels such as the stock market, rising interest rates are always an unwelcome scenario.

Regarding the question of what investors should do when the stock market continuously hits new peaks, Mr. Hinh said that at the moment, stocks are increasing very strongly, so investors should not chase stocks that are increasing rapidly.

“Investors should look for and disburse stocks that have not increased too much compared to the previous accumulation. Groups that still have buying points and can be disbursed at this time are retail and technology groups. For groups that have increased too strongly such as banks and securities, investors should wait to take profits,” Mr. Hinh advised.

Similarly, Mr. Nguyen The Minh gave his assessment that at a time when the market is rising as high as it is now, if investors have not yet followed the group of bank stocks, it is best not to buy immediately, because there may be many risks if the market reverses.

“At this time, if investors have a high margin ratio, they should prioritize reducing the margin first. If the stock ratio is high, they can bring it down to 40-60% of the portfolio to bring it to a safe zone and especially need to observe and carefully study the market,” Mr. Minh advised.

PHAM DUY

Source: https://vtcnews.vn/ap-sat-moc-1-700-diem-chung-khoan-con-tang-den-dau-ar960966.html