The VN-Index broke its two consecutive increases with a decline in trading volume, with the trading volume on the HOSE approaching the average of 20 trading sessions.
The market's trading volume was higher than the previous session, but foreign investors sold a net amount, indicating a negative outlook from this group of investors.
In yesterday's session (August 8), despite the VN-Index declining, it still did not break the short-term technical rebound that had formed in the previous two increasing sessions. The selling pressure was still quite strong compared to the demand on the stock market, however, the important thing is that the accumulation has created a strong support base in the area of 1,200-1,220 points.
After the second-quarter business results reporting season, this is currently a period of low information. Therefore, it is still too early to evaluate whether the market will form a bottom in the short term. This week, the VN-Index maintained the 1,200-point benchmark and conquering the 1,245-point (value of the MA20 day) will be the most important condition for the market to establish a bottom. Otherwise, things will not be more positive.
According to the assessment of experts, what has happened to the stock market is a warning sign when the margin ratio is high and the market trend is unfavorable.
After reaching the peak trading volume and the ability to attract cheap capital in the second quarter, the trading value has decreased rapidly in July under the pressure of net sales from foreign investors, internal shareholders, and issuance pressure. The cash balance of investors has decreased while the margin balance has increased to a record high.
A large margin may be a loan from the business owner and shareholders to fund other activities, indicating that access to credit is difficult, causing them to accept short-term loans from securities companies at very high interest rates (11-15%/year).
This margin does not ensure low risk if the current cash flow of businesses and individuals continues to be difficult, a large margin release will have a more negative impact on the market as a whole than the margin release of individual investors.
August is expected to be a difficult month as the pressure to withdraw funds will continue from foreign investors in the context that market trading volume has not improved. Therefore, experts are quite cautious in their recommendations.
KBSV Securities Company believes that, although the support from the bottom-up capital helps the VN-Index to gradually accumulate the base around the MA200 day, the pressure of high prices is likely to increase at the resistance levels, causing a risk of reversal for the index.
Investors are recommended to sell and reduce their portfolio to a low level when the index or target stock recovers and approaches the resistance areas.
"The market's trading volume was higher than the previous session, but foreign investors sold a net amount, showing a negative outlook from this group of investors. Therefore, we maintain a cautious view, only holding a low average portfolio and buying if the market establishes a bottom," experts from Asean Securities Company stated their view.
