Although the trading week began positively, strong upward momentum quickly diminished due to a notable drop in liquidity, leading to four consecutive days of decline.
While the losses during the week were not excessively large, the VN-Index displayed a tendency to fluctuate within a narrow range, indicating that selling pressure has not yet reached critical levels.
This movement reflects an increasingly cautious sentiment among investors following a period of rapid gains.
On the HoChiMinh Stock Exchange (HoSE), the VN-Index closed the week at 1,870.79 points, while the HNX-Index on the Hanoi Stock Exchange (HNX) was last traded at 252.96 points.
Over the course of the week, the former decreased 0.44 per cent but the latter increased 0.27 per cent.
Market liquidity significantly decreased after two previously explosive weeks.
According to Kirin Securities, the total trading volume on the HoSE reached 4.25 billion shares, a 30.6 per cent decrease from the prior week. The average daily trading value fell by 15.5 per cent to over VND 35 trillion (USD 1.3 billion), highlighting a more cautious approach from investors in terms of capital deployment.
Foreign trading also posed a challenge, as foreign investors maintained a strong net selling position, totalling VND 3.14 trillion for the week, a 40 per cent increase compared to the previous week.
The most pronounced declines were observed in small-cap sectors that had previously surged. Specifically, textiles dropped by 4.48 per cent, insurance by 6.21 per cent and plastics by 7.68 per cent. Conversely, the chemicals sector emerged as a rare bright spot, recording an impressive 8.59 per cent increase, indicative of recovery after several weeks of bottoming out.
Another notable development was the reversal in the performance of State-owned enterprises, which had previously supported the market.
Analysts at Pinetree Securities noted that entities with significant State ownership in sectors like oil and gas, banking and telecommunications no longer exhibited the same strength.
Many of these stocks noticeably declined in the final trading sessions of the week, shifting from market champions to significant pressure points.
Experts from Kirin Securities said that investor sentiment has indeed turned more cautious. The magnitude of the corrections remains limited and overall trading volume remains low, indicating that panic selling has not ensued, and the downward trend is yet to be confirmed.
Technically, the prior bullish trend of the market appears to be merely pausing rather than reversing.
However, Kirin also said that the VN-Index may experience a technical adjustment towards the support level of 1,800-1,810 points in the near future, before resuming a more positive trend.
In this scenario, they advise investors to hold onto existing portfolios and refrain from making new investments, suggesting a careful approach to any potential additions.
Meanwhile, CSI Securities highlighted evident signs of market weakness, emphasising the negative sentiment confirmation following the formation of a clear downward candle on the VN-Index. The upcoming trading week is likely to see technical adjustments.
BETA Securities said that despite ongoing corrections, both the medium- and long-term trends remain intact. Current adjustments present opportunities for investors to restructure their portfolios, focusing on stocks with strong fundamentals, stable cash flow and clear growth prospects.
Longer-term, Vietcombank Securities predicts that Vietnam's stock market has moved out of the relatively cheap zone. They believe the VN-Index could aim for approximately 2,024 points under base scenarios and around 2,279 points in a more optimistic scenario in 2026.
The forecasted price-to-earnings (P/E) ratio for the Vietnamese market sits at around 15.7 times, similar to Thailand and significantly lower than Indonesia and Japan.
Ultimately, as the Vietnamese stock market enters this necessary corrective phase following a prolonged surge, global market developments, particularly in the US, will remain closely monitored by domestic investors.
Last week, the US markets exhibited considerable volatility, reflecting growing caution among global investors due to geopolitical risks and monetary policy prospects. These factors indirectly influenced investor sentiment across global markets, including Vietnam.
