Việt Nam’s benchmark VN-Index is forecast to struggle due to uncertain market sentiment this week, with eyes on the two exchange-traded funds (ETFs) set to finish reviewing their portfolios on March 16.
The benchmark index may struggle to surpass its short-term peak of 1,130 points, which has remained the intraday trading high for the index since January 2018.
The VN-Index on the HCM Stock Exchange ended down 0.07 per cent on Friday to finish last week at 1,123.41 points. The benchmark index scored weekly growth of only 0.2 per cent after five up-and-down sessions.
The minor HNX Index on the Hà Nội Stock Exchange gained 1.14 per cent to close last week at 127.58 points, posting a 0.5 per cent decline after one trading week.
The UPCOM Index on the Unlisted Public Company Market (UPCoM) added 0.88 per cent to end Friday at 61.37 points, up 2 per cent week on week.
The volatile conditions of the market last week underlined uncertain investor confidence as investors were looking toward ETFs to announce their decision on portfolio reviews.
That created short rising waves for the benchmark index as it was pulled by strong investors’ demand within the trading sessions then fell back to the reference levels at the end of the days.
Large-cap stocks were mixed with property developer Vingroup (VIC), budget carrier Vietjet Air (VJC), dairy producer Vinamilk (VNM) and private-equity firm Masan (MSN) among the gainers.
Those stocks advanced total 9.5 per cent, 3.4 per cent, 4.3 per cent and 2.8 per cent respectively after a week while leading stocks in the banking-finance, energy and securities industries also rebounded.
Bảo Việt Securities Company (BVSC) said the indices rebounded on Friday but still moved sideways, with trading volume below the moderate level and falling slightly in bullish sessions.
On average, more than 304.3 million shares were traded on Vietnamese stock market last week, worth VNĐ8.5 trillion (US$378.2 million). The figures were up slightly from the previous week.
The trading conditions reflected the hesitation of investors as they increased profit-taking actions, especially when the VN Index retested its short-term peak in January, BVSC said.
“The market is predicted to continue to move sideways with alternate ups and downs” and “cash inflows are likely to keep running into mid-cap and penny stocks in the next sessions,” the brokerage firm said in its weekly report.
According to BIDV Securities Company (BSC), the benchmark VN Index may trade sideways in the coming week as investors still eye the ETFs’ portfolio reviews, which will end on March 16, and re-direct cash from large-cap stocks to mid- and small-cap shares.
The VNM ETF would add 8.7 million shares of Vincom Retail (VRE) to its investment portfolio. Vincom Retail shares will account for 5 per cent of the total volume of the investment fund.
The recent volatility also came as the market was lacking both macroeconomic and corporate news, with the market outlook set to remain unchanged until the end of April, Nguyễn Hồng Khanh, head of market analysis at Sacombank Securities Company, told tinnhanhchungkhoan.vn.
“At the moment, there is not much positive news to lift the market, therefore, the benchmark index will settle at its current level for the next few weeks and will improve strongly based on leading corporates’ first-quarter earnings,” he said.
Sài Gòn-Hà Nội Securities Company (SHS) warned that investors should be careful given current risky conditions in both domestic and international markets.