VN-Index had its second consecutive explosive session, reinforcing the upward trend that was established in the first explosive session (August 16, 2024).
Yesterday's liquidity reached a fairly high level with matching volume on the HSX exceeding the 20-session average (+26.9%), showing that investor sentiment is very optimistic.
Market observation shows that real estate stocks, after a long period of decline, continue to be the driving force for VN-Index's recovery. In the short term, the VN-Index has ended its downtrend to return to the positive accumulation channel of 1,250 points to 1,300 points.
The positive point is that the supply pressure of low-priced stocks and low T+2 on accounts leads to many short-term buying positions with good profitability. Most of these belong to the group of real estate stocks when many codes have had adjustment periods from August-September 2023, March-April 2024 until now.
Experts from Asean Securities Company believe that the VN-Index will continue to move towards the old peak of 1,280-1,300 points; The tug-of-war process will take place when profit-taking pressure and cautious sentiment increase, and may continue to break out when confirming signals strengthening the price base in this area. Investors should maintain their results and can structure their portfolios into groups of stocks with price strength and positive business information in the short term.
Regarding general market forecast, ACB Securities Company (ACBS) said that the VN-Index will accumulate and move sideways in the 1,150 - 1,300 point range in the context of forecasting that the US Federal Reserve (Fed) will start lowering interest rates from September 2024 and potentially cutting interest rates 3 times this year with a total cut of over 1%; Vietnam's GDP growth can reach over 6.2% in 2024 thanks to the expectation that the growth momentum of over 6% will continue in the second half of the year thanks to momentum from industrial production, construction and exports; Exchange rate pressure gradually decreased at the end of the year; At the same time, the net selling situation of foreign investors improved, although it may still continue to occur in some specific stocks.
It is known that in the first 7 months of 2024, foreign investors net sold about 59,000 billion VND (2.3 billion USD). According to ACBS experts, foreign investors are net sellers due to concerns that some businesses are ineffectively expanding their businesses, and stock valuations have peaked thanks to the connection with the global semiconductor/AI story. However, it was noted that in the last 3 weeks of July and the first days of August, the net selling force slowed down, with consecutive net buying sessions returning.
Regarding business results, ACBS said that in the first 6 months of 2024, the total profit after tax of businesses listed on the floor reached 242 trillion VND, an increase of 11% over the same period. Of which, the groups with strong growth were mainly the financial group, which increased by 15.7%, and the non-financial group, which increased by 7.8%. At the same time, this group of experts forecasts that profit growth in the second half of 2024 will reach over 10%.
Regarding valuation, although it increased compared to the beginning of the year, the valuation is still lower than the average for the period 2020-2024 for large stocks, on the contrary, the valuation of small and medium stocks is not too attractive.
In particular, the P/E valuation of the VN30 group is 12.72 times (average 13.4 times); P/E valuation of VN-Midcap group is 13.3 times (average 15.78 times); and the P/E valuation of the VN-SMLcap group is 17.57 times (average 12.2 times).
Based on valuation, ACBS experts predict that profit prospects are unlikely to make a breakthrough in the next 1-2 quarters, and a large-scale adjustment for small and medium-cap stocks is appropriate. Meanwhile, opportunities in the second half of the year will be somewhat in favor of the VN30 group.
