Experts from MB Securities Corporation (MBS) said: "The decline in Vietnam's stock market is simply a strong adjustment after a long period of quite a hot increase and due to the high pressure of investors to borrow margin".
In general, the decline in exchange rates did not stem from economic factors or corporate profits. The basic factors of the macro economy remain stable and business profits remain bright, supporting the long-term uptrend of the market.
Where the VN-Index stops depends largely on the price level of the bluechips group, whether it is balanced or not, as well as whether it is attractive enough to attract cash flow back. The adjustment took place at the time of a good information explosion, from the best first quarter macro in the past 10 years, business results exceeding business expectations to dividend distribution, Thus, the market adjusted not for information but for stock supply and demand.
Therefore, the market can only stabilize and create a bottom if supply and demand are more balanced. The discount level in this correction depends on the attractiveness of the medium and long-term cash flow that has returned to profit, so the general index has little meaning in this correction, the most important thing is whether the stock is stable in this area or not.
So what is the future for the Vietnamese stock market? The scenario of VN-Index fluctuating around 1,050 points in the current correction, equivalent to the P/E level at around 17.x, is also reasonable. According to this scenario, the VN-Index will have a recovery to 1,140 points. In the medium term, we believe that the VN-Index will bottom out at 1,000 points in the recent correction and then there will be a recovery to 1,140 points, said a representative of MBS.
