New week stocks: New signal from the Fed, will VN-Index surpass 1,300 before the holidays?

The stock market is expected to have a correction when approaching the 1,300 threshold - Photo: QUANG DINH

The stock market maintained an impressive upward trend last week, with the VN-Index approaching the strong resistance zone of 1,290-1,300 points.

After the Fed chairman's statement that "it's time to cut interest rates", the major concern of the global financial market, including Vietnam, is the level and intensity of interest rate cuts...

Fed cuts interest rates, domestic stocks welcome "good news"

* Ms. Tran Thi Khanh Hien - Director of Research, MB Securities Company (MBS):

- In the meeting last Friday, the Fed showed its readiness to adjust interest rates. The reduction of USD interest rates was expected by investors, but when and how often it would be reduced remains the question.

By this time, when the message is clearer, the international financial market, including Vietnam, will have positive reactions.

In addition, domestically, some internal factors have improved, most clearly the issue of exchange rates. When the USD weakens, Vietnam also passes the largest import cycle of the year (May to July every year), the exchange rate pressure is clearly reduced.

Just like last week, liquidity improved quite surprisingly. Some of the positive information and optimistic macro changes were reflected in the price.

However, when the VN-Index increased by 100 points in a row, it is not too surprising that it would correct. Not to mention, 1,300 is a strong resistance level, psychology and cash flow are somewhat dispersed when the September 2nd holiday is approaching. Normally, liquidity slows down before a long holiday.

In general, August is still a period of information vacuum. Therefore, this week, domestic stocks will still be affected by international factors more. If there is any adjustment or fluctuation, it will be an opportunity to disburse new cash flow.

When cash flow is stable, average liquidity is over 20,000 billion VND per session, then the upward trend is clearer.

Note that with the real estate group, the price increase in many stocks is mainly due to low valuations, investors buying for speculation, and there is no real business recovery yet.

Foreign investors will soon return to net buying.

* Mr. Do Bao Ngoc - Deputy General Director of Kien Thiet Securities:

- The expectation of the Fed cutting interest rates has been forecasted and partially reflected in the market in the short term. This may explain why stocks have recovered so quickly recently.

But it should be noted that the Fed's policy shift will create a major change that will not only impact in a few short sessions, but will have lasting effects in the medium and long term.

When the USD depreciates, it will trigger a large shift of money flow on the international market level, creating new opportunities for many industries.

At the same time, the Fed's interest rate cut will further facilitate Vietnam's monetary easing policy. From there, Vietnam can maintain low interest rates, promoting business recovery.

The exchange rate has cooled down, and foreign investors have also reduced their net selling more clearly recently. Even when the USD interest rate falls lower than the VND, it is expected that foreign investors will return to net buying in large quantities. If cheap money flows are maintained, the trend of shifting to other asset markets will be better.

Observing the last 2 weeks, large cash flows have started flowing into stocks. Real estate prices are too high, cash flows will turn to cooling markets like stocks.

This week, VN-Index reached 1,290 - 1,300, short-term profit-taking pressure increased. However, due to better cash flow, stocks rotated to increase in price, if there is correction pressure, it is normal and creates new disbursement opportunities.

Liquidity will slow down before the September 2 holiday

* Mr. Tran Truong Manh Hieu - Head of Analysis Department, KIS Vietnam Securities:

- VN-Index is unlikely to reach 1,300 points in the short term due to psychological and cash flow fluctuations before the September 2 holiday. However, if there is pressure to adjust, it will also be a break for a longer-term uptrend.

The medium-term uptrend of the stock market has gradually become clearer thanks to the economic recovery.

Therefore, in terms of investment strategy, investors can take advantage of the correction (if any) to disburse stocks for the medium and long term.

Some stock groups that are receiving attention during this period include industrial park real estate, which benefits greatly from the increase in FDI capital flows, or public investment and construction materials groups, etc., in the context of public investment disbursement still being promoted.

Source: https://tuoitre.vn/chung-khoan-tuan-moi-tin-hieu-moi-tu-fed-vn-index-lieu-co-vuot-1-300-truoc-nghi-le-20240826080432631.htm