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Mixed view on stock market trend after four-day break
Ngoc Mai 11:52, 2021/05/03
Positive sentiment among investors led to the expansion of three consecutive trading sessions by 20 points before the break, leading to the Vn-Index standing at nearly 1,240 on April 29.

The benchmark Vn-Index is forecast to maintain its upward trend after a four-day break [April 30-May 3], however, the recent Covid-19 resurgence in the country is posing risks that the market would enter a correction phase.

 Investor at a securities firm in Hanoi. Photo: Viet Linh

Positive sentiment among investors led to the expansion of three consecutive trading sessions by 20 points before the break, leading to the Vn-Index standing at nearly 1,240 on April 29.

The decline of the stock market at the start of last week was merely seen as a technical correction to support long-term growth, noted the Bao Viet Securities Company (BVSC) in a note.

BVSC also suggested the fact that the Vn-Index successfully stayed above the 1,200-point supporting zone showed the market is in the accumulation phase before reaching a new height.

“Vn-Index could challenge the resistance zone of 1,268-1,275 in the first week of May, for which the market could subject to minor correction,” said broker Xuan Bach from BVSC.

While the driving force for market rise in the last few trading sessions of April came from stocks of major public firms, KIS Securities Company recommended investors to raise proportion of stock holding from firms in the Vn30 Index, formed by the 30 largest stocks in terms of market capitalization.

Phu Hung Securities Company also gave a similar view by advising investors to look for the most liquid stocks.

In another note, MB Securities Company stated as a number of stocks underwent a correction phase and at attractive value, saying “this is an appropriate time for investors to come in.”

The return of investment capital and positive business results of the first quarters from firms under Vn30 could limit the impacts from “Sell in May and Go Away” adage, referring to an investment strategy for stocks based on the theory that the stock market underperforms in the six-month period between May and October.

Meanwhile, brokerage experts warned investors should take into consideration the current Covid-19 situation before making investment decision, especially as the market witnessed major sell-outs in the previous three outbreaks.

Assuming the market did not have sufficient time to react when the first case was announced on the last day before the break, the market could subject to strong volatility in the next session tomorrow [May 4].

TAG: Vietnam VN-Index Covid-19 resurgence outbreak stock market correction
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