The VN-Index ended the week with impressive gains. However, analysts remain cautious about the sharp decline in liquidity and raise concerns about the sustainability of this upward momentum.

At the start of the week, the stock market was shrouded in a gloomy red. The VN-Index declined to its lowest point, flashing at 1,264.65, causing concern among investors. However, the situation reversed with the appearance of bottom-fishing demand, helping the market recover strongly in the following sessions.

Investors analyse stocks in Hà Nội. — VNS Photo

On the Hồ Chí Minh Stock Exchange (HoSE), the VN-Index closed the week at 1,288.39 points, while the HNX-Index on the Hà Nội Stock Exchange (HNX) ended at 231.37 points.

Both indices experienced significant weekly changes, with the VN-Index rising by 1.4 per cent, while the HNX-Index saw a decrease of 0.56 per cent.

Liquidity on both exchanges saw a sharp decline. Trading volume dropped by 26.23 per cent (on HoSE) and 28.05 per cent (on HNX) compared to the previous week. This indicator reflects the cautious sentiment prevalent among investors, as confidence has yet to be fully restored. It indicates a strong tug-of-war between buying and selling forces, creating a complex and unpredictable market picture.

Foreign investors continued to play a significant role in market dynamics, displaying notable caution. They recorded a net selling value of VNĐ316.36 billion on the HoSE, focusing their sales on large-cap blue-chip stocks such as VPB, HDB, VHM and MWG. However, notable net buying in certain stocks, such as TCB and MSN, helped to balance the overall picture of foreign trading.

Head of Analysis at Saigon-Hanoi Securities (SHS), Phan Tấn Nhật, said that based on reports from the World Trade Organization (WTO) regarding global trade growth and macroeconomic indicators, there were positive signals for Việt Nam's economy.

Nhật remained hopeful about the market’s recovery but emphasised the need for caution amid the sharp decline in liquidity. He noted that the sustainability of the market’s recovery would heavily rely on the revival of cash flow.

In the short term, Nhật believed the VN-Index could hit 1,300 points, but breaking through this resistance level would depend on various factors. Liquidity recovery would be key and the strong divergence across sectors would pose challenges that demand careful stock selection by investors.

Despite some uncertainties, the medium-term outlook remained optimistic, with the VN-Index potentially reaching the 1,300–1,320 range. However, Nhật warned of potential risks, particularly related to geopolitical instability and global economic fluctuations.

Nhật advised investors to focus on stocks with strong fundamentals, solid earnings and good growth prospects. Diversifying portfolios, mitigating risks and capitalising on investment opportunities were crucial at this time, he added.

Analysts from Vietcombank Securities (VCBS) echoed a similar view, highlighting the market’s recovery while urging caution. They pointed out technical signals indicating a fragile balance between buying and selling pressures, along with the need to closely monitor market developments. VCBS also recommended focusing on stocks with strong fundamentals and good growth prospects, especially as the market shows signs of significant divergence.