The stock market needs time to stabilize again.

Investors have been selling off in the past week. Photo: Le Toan

At the end of the last trading week, the VN-Index decreased by 36.7 points (-2.86%) to 1,245.32 points. Liquidity on the HOSE floor weakened compared to the previous week when the matched volume decreased by nearly 9% and there was a session recording the lowest trading value in more than a month. Selling pressure increased in many industry groups, but the most notable were technology and telecommunications stocks when profit-taking occurred after the previous acceleration period.

Foreign investors have shown no signs of cooling down as they continued to net sell nearly VND4,500 billion in the last week of June, of which FPT shares and FUEVFVND fund certificates alone accounted for more than 70%.

According to statistics, foreign investors have been net sellers for the past 5 quarters, especially in the first half of 2024, possibly due to capital withdrawal pressure as the exchange rate continues to be anchored at a high level. After a period of net selling since the beginning of the year, the estimated net selling value has reached nearly 45 trillion VND (approximately 1.8 billion USD). The ownership ratio of foreign investors in the stock market is currently at 17.5%, down about 0.75% compared to the end of 2023.

Although the fluctuations may recur in the coming trading sessions, as long as the support zone of 1,250 - 1,270 points is not violated, the short-term trend remains stable and 1,300 points is the nearest target threshold. Accordingly, experts recommend that short-term investors can continue to hold existing positions in the portfolio and maintain the upward momentum. At the same time, the corrections around the strong support zone are opening up opportunities to optimize stock accumulation positions, especially in the group of stocks with good momentum and much growth potential.

Analysts at TPS Securities Company (TPS Research) believe that VN-Index is currently trading at a P/E of 14.4x. TPS Research believes that the current valuation is still attractive when compared to the prospects of corporate profits recovering this year and compared to the 10-year average of 15.2x. In addition, VN-Index's P/B valuation is currently at 1.8x and is lower than the 10-year average of 2.2x.

Regarding the outlook for 2024, TPS Research's baseline scenario is that the VN-Index will fluctuate around the target of 1,381 points, corresponding to a cautious growth of 10% for the whole year and a target P/E of 15.x, equivalent to the average of the last 10 years. From a more optimistic perspective, the VN-Index could reach 1,444 points with a profit growth scenario of 15% when macroeconomic difficulties will ease and central banks around the world will loosen monetary policies. Thereby stimulating consumption activities to grow again, creating a premise for Vietnam's export activities.

The Fed's monetary policy, global geopolitical developments, foreign investment flows, corporate profit expectations, or even the KRX's delay and difficulty in upgrading the market are listed by TPS Research as risks to watch out for in the remaining period of 2024.

Source: https://laodong.vn/kinh-doanh/thi-truong-chung-khoan-can-thoi-gian-de-on-dinh-tro-lai-1359359.ldo