Vietnam's stock market is weakening: Should investors cut losses or hold stocks?

The first week of October ended with quiet activity on the stock market, with the VN-Index falling slightly by 0.9% to around 1,645 points; the HNX-Index dropping to 276 points and the UPCoM-Index to 109 points.

Stocks are showing a green exterior but red interiors, with foreign investors selling net.

Although the decline wasn't significant, what worried investors was the sharp drop in liquidity, which fell to around 25,000 billion VND per session – nearly half of what it was in August when the VN-Index approached its peak of 1,700 points.

In particular, foreign investors have been net sellers for 11 consecutive weeks, withdrawing over 7,200 billion VND from the HoSE exchange last week alone. SHS Securities Company believes that market sentiment is less optimistic due to a lack of strong supporting information, while short-term loss pressure is increasing.

Weak cash flow caused the market to lose momentum, while selling pressure spread across many sectors such as fertilizers, chemicals, construction, ports, insurance, oil and gas, steel, and real estate.

On financial forums, many investors are sharing their "green on the outside, red on the inside" situation – the index remains above the psychological 1,600-point mark, but their portfolios are suffering heavy losses. Many are repeatedly cutting their losses and buying back, causing their accounts to be severely eroded.

Mr. Le Hoang, an investor in Ho Chi Minh City, said his portfolio is down more than 10%, especially the securities and real estate sectors, which have fallen by as much as 15%. “Many people using margin have lost 15-20% but still haven't dared to cut their losses, hoping for a market recovery. Even information about market upgrades or positive Q3 business results isn't enough to push prices up,” Mr. Hoang said.

Chứng khoán Việt Nam đang suy yếu: Nhà đầu tư cắt lỗ hay giữ cổ phiếu? - Ảnh 3. — Foreign investors have been consistently selling net in recent times.

Patiently waiting for the results of the stock market upgrade.

According to Nguyen Tan Phong, an analyst at Pinetree Securities, the VN-Index is in a consolidation phase lasting more than a month, reflecting investor caution ahead of FTSE Russell's announcement of the results of its review for upgrading Vietnam's market status on October 8th.

"The market remains in a 'green on the outside, red on the inside' state, with only a few large-cap stocks like VIC, VRE, and LPB keeping the index moving. If this group were excluded, the VN-Index would have actually retreated to the 1,620-1,630 point range," Mr. Phong commented.

Despite signs of market weakness, many securities firms believe this is a necessary accumulation phase after the strong rally since the beginning of the year. The index's volatility will gradually narrow in the coming days as investors hold their breath awaiting the upgrade results.

According to Thanh Cong Securities Company (TCSC), the likelihood of Vietnam being upgraded to a higher market status is very high, up to 90%. However, the actual impact after the upgrade will not be immediately apparent, mainly depending on psychological factors. "The important thing is for foreign investors to return to stable net buying; only then will capital truly flow back and the market have a basis to aim for the 1,700-point mark," the TCSC report stated.

In the short term, experts recommend that investors maintain a moderate proportion of stocks, avoid high leverage, and patiently wait for clearer signals after October 8th. The market is currently in a phase of testing confidence, and steadfast investors with sound risk management strategies will be the ones to weather the storm when the recovery trend returns.