Net selling pressure decreased significantly in August
Since the beginning of the year, foreign investors' transactions on the stock market have not shown any signs of improvement as net selling pressure has been maintained in most months, except for January 2024 when net buying was maintained at over VND 1,100 billion. Meanwhile, the lowest net selling month was February, reaching nearly VND 1,500 billion, and May was the strongest net selling month with a value of over VND 19,000 billion.
Up to now, the net selling trend in the market is still going on, however, data from HOSE shows that net selling pressure has gradually decreased in July and August with the net selling value of foreign investors on the floor decreasing to VND 3,611 billion in August, significantly lower than the level of VND 8,376 billion in July.
Meanwhile, on the HNX, foreign investors had their second month of net selling with net selling value increasing from VND110 billion to VND228 billion. On the contrary, on the UPCoM market, this group maintained a narrowing scale from VND199 billion to VND65 billion.
Since the beginning of the year, foreign investors have withdrawn VND64,059 billion from the HOSE floor and VND959 billion from the UPCoM market while buying VND300 billion of stocks listed on the HNX. Overall, this figure has surpassed the record net selling year of VND58,000 billion in 2021.
In August alone, the “national stock” HPG recorded a total net selling volume of more than 100 million shares by foreign investors, equivalent to a value of nearly VND2,500 billion since the beginning of August. Next was VHM, which was net sold for more than VND2,179 billion, and two other stocks that were also net sold for over a thousand billion VND, including VJC for nearly VND1,426 billion and TCB for nearly VND1,058 billion.
In the first 8 months of the year, the strong net selling portfolio focused mainly on high-priced or blue-chip stocks. VHM shares alone were net sold for more than VND15,150 billion; FPT shares were net sold for nearly VND6,599 billion, and VRE was net sold for nearly VND4,750 billion.
Net sales forecast to decrease in the last months of the year
According to analysts, there are many reasons for the continuous net selling of foreign investors in recent times, such as global economic and geopolitical instability, monetary policies in major countries, especially the US, causing concern and great pressure on capital flows, causing investors to withdraw money from the market.
Meanwhile, domestically, the USD price has plummeted, and the exchange rate pressure has decreased after a stressful first 6 months of 2024. The central exchange rate on August 31 was adjusted by the State Bank of Vietnam (SBV) to 24,224 VND/USD, down 21 VND compared to the beginning of the month and down 51 VND compared to the peak of the first 8 months of the year.
In addition, the restructuring activities of investment funds are also an important factor, when they sell large-cap stocks to restructure their investment portfolios. Most obviously, profit-taking on FPT shares is understandable and reasonable when this code has grown strongly this year.
Forecasting foreign trading trends in the coming time, SSI Research believes that the pressure to withdraw foreign capital may ease by the end of this year, with the expectation that the FED's interest rate cut will create new positive momentum for the market.
"Increasing interest rates and fluctuating exchange rates may have reflected the recent decline in stock market liquidity. However, we continue to maintain the target of 1,300-1,350 points for the VN-Index by the end of 2024," SSI Research forecasted.
Meanwhile, assessing the net selling pressure of foreign investors, Mr. Le Anh Tuan - Director of Dragon Capital Investment - shared: "Vietnamese securities have been net sold by foreign investors for more than 2 billion USD since the beginning of 2024, which is a very large number. If the market is not upgraded, it is likely that foreign investors will continue to net sell. However, in order to upgrade the stock market, Vietnam needs to improve the foreign ownership ratio."
