The stock market is starting to face profit-taking pressure, especially in stocks that have recovered well from the bottom.
VN-Index had a decrease in points in the first trading session of the new week today and lost the important resistance level of 1,300 points. However, the most impressive session today (May 19) is the group of Vingroup stocks.
VIC's closing price on May 19 increased dramatically, "clearing the selling side" to VND 85,600/share, the highest in more than 3 years since the beginning of February 2022.
After only 3 months, Vingroup shares have witnessed an increase of more than 110%, marking the strongest price increase in the VN30 group.
Thanks to that, Vingroup's market capitalization increased to more than VND 327,000 billion (equivalent to USD 12.6 billion), consolidating its position as the largest private enterprise on the Vietnamese stock exchange, with a single-weaker capitalization than Vietcombank in the entire market.
Regarding stock market valuation, after the "black ghost" shock in tariffs, the VN-Index quickly fell into a low valuation zone, with the P/E falling below 11 times - an attractive level rarely seen in more than 3 years.
The recent increase in the Vietnamese stock market shows the clear leadership of Vingroup's ecosystem stocks, especially VIC, VHM and VRE.
This group of stocks has contributed more than 70 points to the recovery of the VN-Index in the recent period, becoming the main driving force of the index.
However, besides the momentum from VIN, most other key industry groups such as banking, securities, steel, or retail have not yet recorded a corresponding increase and are in the accumulation zone, showing that there is still room for price increases in the following periods.
According to analysts at Kafi Securities Company, in terms of valuation, banking stocks - which account for a large proportion of the VN30 basket and the whole market - are trading around an average P/B of 1.1x-1.2x, significantly lower than the average of the last 3 years, while the financial platforms of banks are still firmly consolidated with high CAR, asset quality is improved and net interest rates (NIM) are gradually recovering thanks to reduced capital costs.
This shows that the banking group is currently in an attractive valuation state, suitable for the taste of both domestic and foreign cash flow investors.
In the scenario of a continuing to be active market, the group of banks with large capitalization, high liquidity and low sensitivity to unstable information about tariffs is likely to become the focus of leading cash flow.
Dr. Nguyen Duy Phuong - Investment Director of DG Capital - commented that the increasing trend of banking stocks will continue to be maintained.
However, profit-taking pressure may increase next week. The VN-Index may move sideways around the 1,280 - 1,300 point range, with liquidity gradually decreasing, lasting for 1-2 weeks, before having more positive signals in early June.
Meanwhile, from a more cautious perspective, analysts at DSC Securities Company expressed the view that although the current market valuation is low, this "cheapness" largely comes from the banking group - an industry with a large proportion in the general index.
That sets a scenario: If banking stocks are pulled up again, the VN-Index can quickly approach the average valuation range. At that time, the valuation level of many industry groups as well as the general market will no longer be really attractive.
If that happens, in the context of no new catalyst from the macro or business profit growth, the market may fall into a state of " valuation is no longer cheap, but expectations are not strong enough". A deep correction is very likely to occur - similar to what happened in August - September 2023, DSC Securities Company commented.
