HANOI: Closing the first trading week of November with notable fluctuations, the stock market saw selling pressure surge last Friday, causing the VN-Index to fall below the critical support level of 1,600 points.
This marks the fourth consecutive week of decline, totalling a drop of nearly 200 points from its peak of 1,794.58 points reached on Oct 14.
Last week, the VN-Index on the Hochiminh Stock Exchange declined by 40.55 points, or 2.47%, to close at 1,599.1 points.
Meanwhile, the HNX-Index on the Hanoi Stock Exchange wrapped up the week at 260.11 points, down 5.74 points, or 2.16%, compared to the previous week.
The substantial drop in the VN-Index places the Vietnamese stock market among the 10 worst-performing markets globally over the past week.
Liquidity continued to weaken, with the total trading value for the week reaching nearly 126.4 trillion dong, down 8.15% from the prior week.
The trading session on Nov 6 recorded the lowest liquidity in five months, with trading volumes plummeting by 45.6% compared to the average of the past 20 sessions. Foreign investors maintained a net selling position but with less intensity.
After consecutive weeks of heavy selling, foreign trading activity showed signs of cooling.
They sold over 93.2 million shares last week, amounting to more than 2.5 trillion dong, which represents a 45.8% decrease in volume and a 17.2% decrease in value compared to the previous week.
Experts expect that short-term market adjustments may continue as investors seek a balance point.
According to Dinh Viet Bach, an analyst at Pinetree Securities, selling pressure is likely to stem from major stocks, particularly in the banking sector, Vingroup and some components of the VN30-Index.
However, mid-cap stocks are beginning to show more positive signals and may even establish a short-term bottom.
Experts from Pinetree predict that the market may experience further volatility this week to shake out weaker positions, potentially activating capital waiting on the sidelines. A crucial requirement for this recovery is the return of buyer interest, which could lead to a technical rebound.
Conversely, if investor caution persists, selling pressure could extend to even the stronger stocks, pushing the index further down to the 1,500 to 1,520 point range.
Investors holding high positions are advised to use any technical rebounds at the beginning of the week to restructure and mitigate risks in their portfolios.
For those maintaining reasonable allocations, this period could present opportunities to observe and identify new entry points as the market stabilises. — Viet Nam News/ANN
