With cash flow responding to the upgrade event spreading throughout the market, green color has spread on the market almost throughout the trading session. When demand spread throughout many industry groups, at one point, the VN-Index surpassed 1,840 points.
However, as soon as it entered the ATC session, the VN-Index suddenly fell quite sharply, at one point falling below the reference level by about 31 points. Today's fluctuation came from ETF funds restructuring their portfolios. Starting with Vingroup's VIC stock falling to the floor. Following that, a series of large-cap stocks such as VHM, VPB, HDB, TCB, BID, CTG... all decreased in price.
Closing the trading session on September 18, VN-Index decreased by 7.11 points, equivalent to -0.39% to 1,815.66 points. Thus, at the end of the trading week, the VN-Index increased by 20.45 points, equivalent to +1.14%.
After a fairly strong week of decline (losing more than 57 points) and losing the psychological threshold of 1,800 points, the market this week has had relatively positive recovery signals, although cash flow has not really exploded. Supporting information comes from the fact that FTSE will officially upgrade the market from September 21.
In a volatile trading session, stock market liquidity increased sharply. Total trading value on HoSE reached more than 25,900 billion VND, 44% higher than yesterday. For the first time since the end of June, liquidity has just approached the billion USD mark. Block transactions contributed more than 161 million units, worth 3,915 billion VND.
The upgrade information has brought about real results when foreign investors returned to net buying about 1,262 billion VND. This is the highest level since mid-July.
In the short term, the stock market may experience strong differentiation. Stocks in the portfolio that funds simulating indices buy may be supported in terms of demand, while stocks outside the portfolio or under restructuring pressure may have different developments.
Investor sentiment in the upgrade phase may be affected simultaneously by positive expectations and profit-taking sentiment. A part of investors expect foreign capital to create a new price level. Conversely, those who bought stocks before the upgrade information may choose to realize profits when the official event takes place.
Therefore, the market may experience high liquidity trading sessions, strong fluctuations and differentiation between stock groups. This is a development that needs to be seen in the context that the market is absorbing a major event, instead of rushing to conclude about the long-term trend from just a few trading sessions.
FTSE Russell's upgrade of the Vietnamese stock market is not only a change in index classification but also reflects the reform process to improve market access, transparency and level of integration with the international financial system.
