Vietnam stock market awaits support factors for breakthrough

HANOI: The stock market traded in a sideways trend last week, with fluctuations testing investors’ patience as expectations for a market breakout to reclaim the 1,300-point peak did not materialise.

Additionally, trading volume was below the 20-day average, indicating a cautious sentiment among investors.

On the Ho Chi Minh Stock Exchange (HoSE), the VN-Index closed last week at 1,282.02 points, while the HNX-Index on the Hanoi Stock Exchange (HNX) ended at 244.36 points.

Both benchmark indices recorded a slight weekly increase, with the VN-Index and HNX-Index each rising by 0.16%.

Liquidity on the HoSE saw a slight drop, with the market’s trading value reaching23.4 trillion dong per session, reflecting a marginal 4.4% decrease from the previous week.

Foreign investors continued to sell heavily, with net sales of around one trillion dong per session from June 17 to 21.

Blue chip stocks were the main focus, particularly FPT shares, which accounted for a qaurter of the net sales.

On the HoSE, foreign investors sold off stocks for five consecutive sessions, with a total net sale of 139.8 million shares worth 4.9 trillion dong, increasing by 1.64% in volume but decreasing by 10.1% in value compared to the previous week.

Nguyen Khac Thanh, an analyst at Saigon-Hanoi Securities (SHS), said there were positive signals in the market, noting that the VN-Index frequently tested the strong support level around 1,270 points and subsequently rebounded to the 1,280-point area.

However, liquidity decreased on both exchanges compared to the previous week, reflecting investor caution.

After a week under adjustment pressure, the data showed the markets experienced strong volatility around the 1,300-point resistance level, corresponding with the upperboundary of the mid-term trend line.

Thanh noted that the market traded within a narrow range of 1,270 to 1,285 points for five sessions.

SHS data showed that the 1,285-point level was the highest since September 2022 and May 2024.

The VN-Index closed the week above the 20-day average level of around 1,280 points, with highly differentiated trading activities and reduced liquidity.

Thanh said he expected the VN-Index to continue accumulating within the 1,250 to 1,300-point range, with a balance around 1,280 points.

The current movement suggests an expectation for the VN-Index to surpass the 1,285-point level, aiming to return to the 1,295-point resistance area.

In a less optimistic scenario, the VN-Index might trade between 1,250 and 1,280 points.

The Vietcombank Securities (VCBS) analysis team highlighted that gold prices had surged to a two-week high due to signs of economic weakening in the United States.

Specifically, global gold prices rose sharply on June 20 after data indicated a slowdown in the US economy, reinforcing expectations that the Federal Reserve might begin cutting interest rates in September.

Analysts noted that bullish speculators have regained dominance in the gold market, targeting prices above US$2,400 per oz.

Meanwhile, major central banks remain cautious about interest rates.

Domestically, VCBS analysts observed that the VN-Index closed the week with a slight decline, reflecting cautious sentiment in the 1,270 to 1,290 points range.

Indicators remain unclear, suggesting that the market needs more time to find a balance point.

However, significant short-term volatility risks are not a major concern. — Viet Nam News/ANN