Geopolitical tensions continued to escalate, causing oil prices in the morning trading session of September 9 to exceed the 100 USD/barrel mark for the first 3 times since the beginning of 2022 and showed no signs of cooling down. This has caused domestic oil and gas stocks to continue to heat up in the session, while the general market faced strong selling pressure.
VN-Index and VN30 lost 114 points and 130 points respectively at the end of the morning session on March 9, respectively 6.47% and 6.82% compared to the reference level. VN-Index retreated to 1,653 points, while VN30 fell to 1,774 points, the lowest level since mid-December last year.
HoSE had 357 declining codes, of which nearly 220 codes lost their amplitude. The market only had a few representatives reversing the trend such as BSR of the oil and gas group, DPM of the fertilizer group, HRC and TNC in the rubber group. Liquidity reached 26,000 billion VND, of which more than half came from large-cap baskets.
Cash flow is escaping from the financial sector, causing most stocks in this sector to fall to the floor in series. Specifically, strong selling pressure is concentrated in MBB, VCB, SSI, TCB, HDB...
Next is the group of real estate stocks also in a similar situation with overwhelming selling pressure in codes such as VHM down 6.84%, VIC down 6.9% and a series of stocks falling to the floor such as IDC, CEO, KBC, NTL, KHG....
Investors believe that the sudden increase in margin calls from securities companies and off-system lending (shadow lenders) is the main reason why the market adjusted more than 100 points. If there is no cash flow absorbing the volume of stocks waiting for release at floor prices, the market may continue to fall sharply.
It can be seen that geopolitical tensions in the Middle East are the main reason why capital flows continue to tend to exit risky assets to find safe assets. Global capital flows tend to leave risky assets, also creating an impact on the Vietnamese market, causing foreign investors to continue to net sell.
Technically, the market's decline and "breakdown" of some important support zones (such as MA50) also triggered strong selling pressure. In parallel, the market's valuation is no longer too cheap.
Forecasting developments and upcoming impacts, experts agree that the market is completely dependent on developments in the Middle East.
In the worst-case scenario, it is predicted that Vietnamese stocks may fall from 20 - 25% from the peak of 1,900 of VN-Index before they can recover. Persistent conflict, even possibly for a few months or more and oil prices maintaining at a high level, may create more inflationary and exchange rate pressure for Vietnam, causing very significant damage to the economy.
In a more optimistic scenario with geopolitical tensions not prolonging, everything will stabilize again. The market's negative reaction in the short term may create opportunities in the medium and long term when stock prices and the general market valuation level are pulled back to the attractive zone.
When an accurate scenario for developments in the coming time cannot be given, experts recommend that investors should not sell off stocks excessively. However, risk management still needs to be emphasized by minimizing the use of margin and maintaining only an average ratio.
