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| Investors trading stocks. The stock market has fallen for two consecutive weeks. — Photo: baotintuc.vn |
HANOI — Markets fell in the third week of July, showing a tug-of-war trend.
After two relatively calm trading sessions earlier in the week, selling pressure increased on Tuesday and in the final trading session.
Most experts believe that 1,250 will be a strong support and the index is unlikely to fall significantly below this threshold, so investors may consider returning to promising stocks for the second half of the year.
Unlike the previous week, large caps played a supporting role in the market during the consolidation session, with selling pressure mainly coming from mid-cap stocks.
The Ho Chi Minh Stock Exchange’s (HoSE) VN Index ended the week at 1,280.75 points, while the Hanoi Stock Exchange’s (HNX) HNX Index closed at 245.02 points.
Both indexes fell on a weekly basis, with the former down 1.25% and the latter down 1.84%.
Despite the market decline, liquidity improved for the second consecutive week. Average trading volume on the Ho Chi Minh Stock Exchange reached VND19.48 trillion ($769.34 million), up 0.27 percent from the previous week.
Foreign investors continued to be net sellers, but selling pressure eased slightly and bottom-hunting was seen in two sessions.
“Although it was a down week, there were still many positive signs in the market,” said Dinh Quang Hin, head of macroeconomic and market strategy at VNDIRECT Securities.
“First, there were signs that foreign investors’ net selling tendency was slowing as the Fed signaled more clearly that interest rates could be cut, and there was bottom-buying activity by foreign investors mid-week.”
Market liquidity also improved as investors actively deployed funds during the big intraday correction. Cash flows were not withdrawn but rather moved among various sectors. In particular, pillar stocks in the banking sector once again attracted cash flows amid a situation where “credit is starting to flow” and the gradual emergence of favorable performance of some commercial banks.
These are reasons to expect that the market will not undergo a major correction, and the 1,250-point area will act as a strong support for the VN Index. However, on the other hand, the market lacks strong enough impetus and support to form a short-term uptrend.
“Investors should consider exiting stocks that have recently surged and are no longer ‘cheap’ and switching to sectors and stocks that still offer attractive valuations and improving business outlooks, such as the finance and banking sector and some export companies,” Hin added.
According to experts from VietDragon Securities (VDSC), the market has become cautious as it approached the 1,280-point resistance area and retreated. Liquidity has increased compared to the previous session, indicating that supply pressure is still weighing on the market. However, the market is still supported at the 1,260-point area. At the beginning of the new trading week, it is expected that the market will continue to fluctuate around this area, testing supply and demand.
However, due to recent volatility, investors should still remain cautious and pay attention to high-risk market conditions. Therefore, investors should slow down, observe supply and demand trends, and reassess market conditions. In addition, investors should consider taking profits or restructuring their portfolios when the market recovers to minimize risks.
Experts from SHS Securities believe that if the VN Index continues to correct and the ratio falls below the average, they should consider selling when the VN Index is around 1,250 points. The target is leading stocks with good performance in the second quarter and bright prospects for the end of the year. — VNS
