VN-Index's "upward door" is still bright

The Vietnamese stock market experienced the first trading week of the second quarter in a state of recovery when all five sessions increased points, helping the VN-Index surpass the 1,280 point mark.

At the end of the week, VN-Index increased by 37.72 points compared to the previous week, equivalent to 3.03% to 1,283.04 points. HNX increased by 1.99% to 242.31 points.

Last week, HVN increased by 9%, BID increased by 9.36%, VCB increased by 3.29% and LPB increased by 14.18%, which were the main codes supporting the market. On the contrary, SAB, VRE, HDB were the factors putting pressure on the general index.

However, the liquidity of the whole market is somewhat narrowing, showing the caution of investors. Foreign investors continued to net sell VND 2,163 billion on all 3 exchanges, of which foreign investors net sold VND 2,308 billion on HoSE, net bought VND 99 billion on HNX and net bought VND 46 billion on UPCoM.

According to Ms. Hoang Viet Phuong - Director of SSI Securities Company's Investment Analysis and Consulting Center, overcoming the "headwinds", the Vietnamese stock market still has many bright colors when continuing the recovery momentum from November 2023 and continuing to break through in terms of points. Despite going through a short correction in April and continuing to decrease by 1.3% in June, the VN-Index still grew positively by 10.2% since the beginning of the year.

VN-Index performance last week (Source: TradingView).

The estimated 2024 cP/E of VN-Index is currently at 11.5x, lower than the 5-year average of 13.4x. With this valuation, the "upside" of VN-Index is still bright in the second half of the year and into 2025.

In the short term, cautious observation is necessary when the general market risk is increasing. Investors should patiently wait for a truly attractive price range, focusing on the individual stories of each stock to make new disbursements; while continuing to hold stocks that are expected to grow strongly.

Ms. Nguyen Thi Thuy Linh - Director of Analysis at An Binh Securities Company (ABS) commented that Vietnam's economic indicators show very positive signals with GDP in the second quarter reaching nearly 7%, an impressive level compared to other countries in the region and with past data.

In addition, the gold market has also been stabilized by the State Bank of Vietnam (SBV) when the price of SJC gold bars remained stable throughout June and is expected to continue at this level in July. This is a good signal for the economy as money will no longer flow into gold reserves but will be circulated, contributing to overall growth.

Although the exchange rate remains a headache for the State Bank of Vietnam as it has been continuously climbing in June, ABS believes that in July the rate of increase of this currency pair will not be as fast or even turn down when the operating interest rate and the interest rate of the VND market have been increasing again.

The stock market is moving with cash flow and trading volume tending to weaken as it approaches the 1,300-point barrier. Foreign investors have been continuously net sellers in recent months with large values, the pressure on exchange rates has increased, along with the regulation of liquidity in the currency market... are factors that have prevented the market from reaching consensus for a strong breakthrough.

Experts from ABS predict that July will be the time when the market absorbs negative factors well and creates a sideways accumulation zone with a large price range of 1,300 - 1,180 points, preparing for the uptrend in the second half of 2024. In the medium term, we still maintain our expectation for the VN-Index to grow to the 1,350 - 1,395 point range according to the report at the beginning of the year. The milestone to confirm the new uptrend of the market is when the closing price of the trading week surpasses resistance 1 at 1,315 points.

Regarding investment strategy, after corrections with price ranges around 60-100 points, there will always be quick technical recoveries with increasing sessions thanks to large-cap stocks. For investors who prefer quick transactions, it is necessary to base on the support - resistance levels of the market and the specific increase and decrease range of stocks. For medium and long-term investors, this cumulative correction of the market will be an opportunity to participate in stocks that create medium-term and long-term buying points.

Priority sectors in July include: insurance, energy, real estate, fertilizer, textiles, aviation, banking. Stocks need to have positive business results prospects, benefit from macro factors, have a suitable accumulation model in terms of volume and time, and have room for price increase .

Source: https://www.nguoiduatin.vn/lang-kinh-chung-khoan-8-7-cua-tang-cua-vn-index-van-sang-a671846.html