Markets forecast to get boost from supportive information

The VN-Index on the Ho Chi Minh Stock Exchange (HoSE) rose 1.15 per cent to close at 1,248.78 points.

The index had lost 2.48 per cent last week.

An average of 628.8 million shares were traded on HoSE during each session last week, worth VND15.3 trillion (US$650.4 million).

A statue of a bull and bear outside the HCM City Stock Exchange. By the end of August, the total number of domestic individual investor accounts was 6.4 million accounts. - Photo hsx.vn

In the newly published September market strategy report, the SSI Securities analysis team (SSI Research) said that the domestic macro economy is showing positive movements.

Economic data in August was more positive than expected, making the target of 7 per cent GDP growth in 2022 easily achieved. The inflation target is still under control. Manufacturing activities will continue to be supported by the traditional export sector while domestic consumption maintains a positive momentum, SSI said.

The market is continuing to observe the State Bank of Vietnam (SBV)'s allocation of the remaining credit growth limit to banks and the exchange rate movements, as well as the SBV's management measures in the context that the Fed is expected to continue raising interest rates.

The analyst team maintains a neutral view on the short-term cash flow trend, when it is difficult to exclude pressure on capital flow in the context that external risks are still maintained, especially the strengthening trend of the US dollar.

However, SBV has taken steps to show its commitment to maintaining a stable exchange rate environment, and a positive long-term outlook for Viet Nam's stock market.

The report also mentioned the possibility that the US stock market's negative movements will put downward pressure on the Vietnamese stock market. The trend of the market index in September will depend on the results of retesting the resistance area of ​​1,285 points of the VN-Index.

If conquering and stably maintaining above 1,285 points, the index will extend the recovery to 1,300 - 1,310 points. On the flipside, if the index corrects from 1.285 zone, the 1,220 points is a good support area for the index.

“After two declining sessions, VN-Index quickly tested the area below 1,230 points and rebounded,” said Viet Dragon Securities Co.

“Currently, VN-Index shows a Hammer support candle signal, which may help the market have a technical recovery span. However, the support level of cash flow is still not strong, reflected in low liquidity. Therefore, it is still necessary to consider the possibility that VN-Index will be blocked at 1,260 – 1,265 points in this resurge journey.

“For now, investors should still slow down and observe supply and demand movements soon to re-evaluate the market. However, in the interim, taking advantage of the recovery span is still advisable to reduce risks.

“The cash flow to catch low prices strongly joined at the end of the session so the index quickly withdrew and closed the week with a positive hammer candlestick pattern. Besides, the liquidity mostly came from large-cap group, showing the will to keep the index stable above SMA50.

“With this signal, the market is expected to have a good recovery span in the coming sessions. However, in the short term, it should be noted that the shaking at the resistance area around 1,285 points of the VN-Index should be noted.

“Therefore, investors can gradually buy stocks that recover well from the local trading range and still stay above SMA50. At the same time, wait for the higher price range to sell weak stocks because the risk of continued decline from resistance area still exists.”

According to data just released by the Vietnam Securities Depository (VSD), the market added 152,873 new accounts in August, marking the lowest level since November 2021; in which, the number of domestic individual investor accounts opened 152,398 new accounts, down 22.1 per cent compared to the figure of July.

By the end of August, the total number of domestic individual investor accounts was 6.4 million accounts. In the first eight months of the year, this group opened nearly 2.2 million new accounts.