The majority of securities firms have advised investors to refrain from selling out their stocks as market could soon recover following yesterday’s deep slump.

Investor at a securities company in Hanoi. Photo: Kinhtedothi

At the close on June 8, the benchmark Vn-Index fell by 2.86% or 38.9 points against the previous trading session to 1,319.88.

The fact that Vietnam’s stock market has been on the rise for last five consecutive trading sessions and remained one of the best performing in the world puts investors under huge pressure on selling for profit.

Along with selling pressure from domestic investors, their foreign peers continued to maintain the position as net seller with over VND360 billion (US$15.7 million) on the Ho Chi Minh City Stock Exchange (HoSE), taking the total net sale figure of foreign investors to over VND31 trillion (US$1.35 billion) since early 2021.

SHS Securities company said it is no doubt that yesterday’s big slump is causing concern among investors that the market may turn to a negative trend.

“But it would be too soon to conclude that whether the market rise is coming to an end or just a short correction period before making a breakthrough,” noted SHS.

While the strong capital inflows may keep the market return to a positive trend, SHS suggested investors should buy in stocks in case the Vn-Index falling into short-term supporting zone of 1,300-1,310.

MBS Securities Company shared the same view by saying recent movements of the market showed technical recovery often occur after sharp decline. In this regard, MBS expected the supporting zone for Vn-Index would be around 1,300-1,315.

According to Viet Dragon Securities Company (VDSC), the market’s recent strong correction caused deep concern among investors as there was no negative news that could influence their sentiment.

“However, we realize that this is just a normal correction cycle of the market, when large-cap stocks gained too quickly recently and needed to adjust and create a new price equilibrium. Therefore, this could be a good opportunity for investors consider buying good stocks that have gradually plummeted to the short-term support area,” said Nguyen Bao from VDCS.

In short-term, Agriseco Securities Company said the market may continue its correction phase and go back to the 1,300-zone. “If the market can keep this mark, Vn-Index will expand again in upcoming sessions,” said Agriseco.