The stock market corrected again with 4 out of 5 sessions decreasing last week. Increased profit-taking pressure amid weak demand has put the market in a difficult position. Liquidity is still the bottleneck of the market, trading volume remains below average, showing that investors are starting to be cautious again. The VN-Index closed the last trading week at 1,262.57 points.
In terms of impact, VCB, HPG and MSN were the pillar stocks that pulled down the index the most yesterday, taking away about 1.5 points from the VN-Index. On the contrary, there was no outstanding name on the positive side to support the market. MWG led the way but only helped the index increase by less than 0.4 points, the remaining stocks had a negligible impact.
Overwhelming selling pressure forced most industry groups to end the week in red. Except for the highlight of BSR (+4.65%) which helped the energy group record an increase of 2.68%. However, most of the remaining stocks in this industry could not escape the general correction trend.
Furthermore, the prolonged net selling by foreign investors, combined with the lack of supporting information and leading stocks, further shook investors’ confidence. Foreign investors continued to net sell more than VND1.13 trillion on both exchanges last week. Of which, foreign investors net sold more than VND1.18 trillion on the HOSE and net bought nearly VND48 billion on the HNX.
In the newly released report "Investment Compass December 2024", VNdirect Research Securities Analysis Block forecasts that VN-Index will close 2024 at 1,250 - 1,270 points.
VNDirect Research believes that the Fed will continue to cut interest rates at its upcoming December meeting, thereby cooling the DXY index, reducing pressure on the VND exchange rate and creating conditions for the State Bank to focus more on supporting system liquidity and credit growth. These factors can have a positive impact on stock market liquidity and investor sentiment.
Although economic growth and the profitability picture of listed companies have improved, these positives have not been fully reflected in market valuations, due to record net selling from foreign investors, in addition to greater exchange rate pressure and liquidity stress in the final months of this year compared to the same period in 2023.
“Given the current valuation and macroeconomic context, this is the right time for long-term investors to proactively allocate capital and accumulate stocks to build a portfolio for 2025. However, the market has not yet established a solid uptrend, and excessive use of financial leverage can be counterproductive and increase risks. Investors are advised to adopt a cautious capital allocation strategy,” VNdirect Research recommended.
