Liquidity evaporates 27%: A gloomy week for the market

The Vietnamese stock market closed a gloomy trading week from October 27-31, as increased selling pressure pushed the main indices down, leading to a sharp decline in liquidity. This development reinforced the cautious sentiment that has prevailed in the market after a series of strong fluctuations in recent times.

Stocks last week had a week of sharp decline on low liquidity.

Index plummets, liquidity evaporates

At the end of the trading week, VN-Index decreased by 43.53 points (equivalent to -2.59%), down to 1,639.65 points. On the HNX floor, HNX-Index also lost 1.43 points (-0.54%), stopping at 265.85 points. An equally notable highlight was the sharp decline in liquidity, clearly reflecting investors' apprehension.

Specifically, the total trading value of the entire market last week only reached 137,596 billion VND, down 26.76% compared to the previous week. On the HoSE, the average matched volume reached 890 million shares/session and the average value reached 27,562 billion VND/session, down more than 26% and 27% respectively. This figure on the HNX was even more tragic when the total trading value dropped sharply by 34.8%. Compared to the 20-week average, matched liquidity was 30% lower, a sign of the absence of strong demand.

The selling pressure mainly comes from a number of large stock groups such as Vingroup or Gelex . However, the factor that worries many investors is that foreign money continues to withdraw strongly from the market for the second consecutive week. The total net selling value of foreign investors on both exchanges reached more than VND3,072 billion, of which on HoSE alone it was more than VND2,700 billion.

Detailed analysis shows that foreign capital is focusing on selling heavily in the banking and securities groups. MBB shares lead the list of net sales with a value of up to 1,185 billion VND, followed by SSI with 937 billion VND. On the contrary,FPT shares are a rare bright spot when foreign investors buy strongly with a value of up to 1,350 billion VND, becoming the focus of demand in the context of a gloomy market.

Besides foreign cash flow, a part of domestic capital also tends to shift and seek opportunities in small, highly speculative stocks such as SMC, KHG, LDG, DRH, HSL...

Comments from securities companies: Caution is paramount

In the context of an unpredictable market, securities companies also expressed different views, and many forecasts were "out of sync" with actual developments.

AIS Securities had a rough week of commentary. After an unexpectedly sharp decline on October 27, AIS turned negative on October 28, warning that the decline could continue. However, the market immediately had a strong recovery phase. Since then, AIS has switched to a neutral stance, forecasting that the market will accumulate and recommending that investors take advantage of technical recovery sessions to restructure their portfolios, reduce the proportion of weak stocks and only hold stocks with real potential.

Meanwhile, Vietcombank Securities (VCBS) does not give specific trend forecasts but only focuses on strategic recommendations. VCBS advises investors to closely follow developments, take advantage of uptrends to restructure portfolios, proactively manage risks and reduce leverage. At the same time, maintain a stable mentality and purchasing power to be ready to take advantage of short-term opportunities from market fluctuations.

AseanSC Securities Company had only one accurate forecast in the slight increase session on October 29. In the first two sessions of the week, their forecasts were contrary to reality. After these fluctuations, AseanSC became more cautious and maintained the view in the last two sessions of the week that the VN-Index would continue to fluctuate due to pressure from the resistance zone of 1,690-1,700 points.

Despite a week of market decline, many experts remain optimistic about the medium and long-term prospects. The short-term net selling by foreign investors is believed to be mainly due to psychological factors, and the possibility of this cash flow returning is very high as the fundamental outlook remains positive.

The market is currently supported by a stable economic foundation, reasonable policies, growing corporate profits and attractive valuations. The fact that FTSE Russell has put Vietnam on the upgrade list, although it requires careful preparation, is still an important positive signal.

Furthermore, the fact that margin debt (margin loans) reached a record level while liquidity remained above the billion-dollar threshold shows that investors' confidence in the stock market is still very high. Like many previous waves, when the market is excited, the index and transaction value increase, the margin will also increase, reflecting the expectation of profit.

Thus, the past trading week with its volatility and low liquidity may just be a short break in the long-term journey. The problem for investors now is to stay calm, flexible in strategy and have a longer-term view of the fundamental factors that support the market.

Source: https://thoibaonganhang.vn/thanh-khoan-boc-hoi-27-tuan-am-dam-cua-thi-truong-172938.html