The market is entering a phase of strong differentiation.

Despite a positive start to the week, the market declined towards the end as unfavorable news regarding companies in the "renewable energy" sector triggered a sell-off across a range of stocks on all three exchanges, leading to sharp corrections in stock indices.

However, market sentiment stabilized in the following session, helping the VN-Index close the week at 1,138.1 points, up 1.6% from the previous week. Conversely, the HNX-Index fell 0.7% from the previous week to 225.8 points, and the UPCoM-Index fell 1.6% from the previous week to 84.7 points.

Cautious sentiment led to a continued decrease in liquidity, with the average trading value across the three exchanges reaching VND 17,943 billion per session, down 5.8% from the previous week. Foreign investors sold heavily, with a total net selling value of VND 390.2 billion, a tenfold increase compared to the previous week.

Specifically, the net selling value recorded on HoSE, UPCoM, and HNX was VND 372.6 billion, VND 15.3 billion, and VND 2.2 billion, respectively.

Mr. Nguyen Van Giap, Head of Investment Consulting Department, VPS Securities Joint Stock Company, and Mr. Nguyen Phuong Hieu - Consultant - Individual Clients Division, both share the view that the VN-Index is highly likely to maintain the 1,200 point level and may experience further corrections to consolidate this support zone.

Market valuation over the past year (Source: Fiintrade).

Reporter: After a week of fluctuating movements, the VN-Index has set a new high for the beginning of 2023. Overall, in the first half of the year, the VN-Index has surged 113 points, equivalent to 11.3%, to reach 1,130. The market's upward momentum is accompanied by significantly improved liquidity, and the number of new investor accounts has also been recorded at a high level. Will this trend continue into July? Which direction will the VN-Index lean more towards in your opinion?

Mr. Nguyen Van Giap: Currently, foreign investors are holding a large amount of long contracts for July, while institutional and proprietary traders are still actively buying net. In addition, from a technical analysis perspective, a marubozu candlestick on July 7th completely negated the previous declining sessions.

All of the above factors promise further gains for the VN-Index. In addition, with Q2 GDP growth exceeding 4%, there is a positive outlook, suggesting further interest rate cuts in the next quarter to achieve the 6% target for this year (Q3 and Q4 growth would need to reach 8-9% to achieve this target).

However, achieving such a GDP growth rate is, in my opinion, almost impossible. Therefore, I believe there will be no uptrend this year, but rather a continued wide-range sideways movement.

Investors should be cautious, because peaks are always noisy, while bottoms are always quiet. If there are explosive market surges, it's advisable to stop buying and reassess the upside potential of the stocks you hold. This year, in my opinion, the market could reach 1,200 points, but there will be alternating corrections, while many stocks are currently trading at levels equivalent to the VN-Index of 1,300 points.

Mr. Nguyen Phuong Hieu: In my opinion, the current situation reflects the government 's policy efforts over the past six months. It's evident that capital is shifting back to the stock market, and investor confidence is gradually returning after the incident in October 2022.

Given the current situation, if the State Bank of Vietnam continues to maintain the current low interest rate level, and inter-market developments do not cause any "shocks," it is highly likely that the VN-Index can maintain its upward momentum to conquer higher milestones such as the 1,150 or 1,200 range. During this upward trend, corrections are inevitable to prevent the market from overheating and rising recklessly.

Reporter: With the half-year earnings announcement approaching, do you think the results for the second quarter will be more positive than the lackluster first quarter?

Mr. Nguyen Van Giap: In my opinion, the second quarter will see improvement, as monetary policy will reduce the debt burden on many businesses; and the current economic context will give many sectors the opportunity to break through.

After the half-year business results are released, many companies will be assessed as being at the bottom of their profit margins this year. However, if expectations are too high, investors should reconsider because, as mentioned above, this year will generally still be difficult.

Mr. Nguyen Van Giap, Head of Investment Consulting Department, VPS Securities Joint Stock Company.

Mr. Nguyen Phuong Hieu: Currently, there is a lot of information regarding projected business results for many companies. For example, BFC, in the fertilizer industry, reported a profit in Q2/2023, compared to a loss of 40 billion VND in Q1/2023. This industry is hitting its profit bottom in this second quarter.

In addition, some sectors are also showing signs of bottoming out in terms of profits, for example, the steel industry also has a positive business performance forecast as the rate of decrease in raw material prices is faster than the decrease in selling prices, demand is recovering, and businesses are reopening blast furnaces...

Therefore, in my opinion, the 2023 semi-annual financial report period is quite positive for the market in general, and especially for sectors related to manufacturing and exports.

Reporter: In your opinion, besides currently prominent sectors such as public investment and construction materials, what other sectors could investors choose that are likely to continue attracting investment in the future?

Mr. Nguyen Van Giap: In my assessment, the seafood, chemical, and transportation sectors will be stable in the coming period. The seafood sector will benefit strongly from reduced bank interest rates and fees; in addition, the proposed 10,000 billion VND credit package to stimulate demand and support seafood businesses in purchasing raw materials from farmers; and the 2% reduction in VAT will also benefit this sector.

The shipping and chemical sector will benefit from short-term news. Panama Canal traffic is restricted due to low water levels, and the effects of El Niño are leading to increased global freight rates. Global urea prices are also rising again due to fires at several large chemical plants around the world .

This is a period of strong market differentiation, with many stocks like VND facing setbacks due to the risky "all-in" investment in Trung Nam bonds. Therefore, investors should choose fundamentally sound stocks at this time.

Mr. Nguyen Phuong Hieu: Besides the fertilizer and steel sectors, in the short term, I personally believe that export-related sectors such as textiles, seafood, and wood are also worthwhile investment options for investors to consider. Currently, the State Bank of Vietnam's continuous interest rate cuts are causing the USD/VND exchange rate to rise, creating certain favorable conditions for export-oriented sectors .

Source: https://www.nguoiduatin.vn/lang-kinh-chung-khoan-107-thi-truong-vao-giai-doan-phan-hoa-manh-a616374.html