HÀ NỘI — Vietnamese shares are forecast to move positively this week, less affected by the US presidential election than initially assumed.
The benchmark VN-Index on the Hồ Chí Minh Stock Exchange increased 0.06 per cent to close Friday at 938.29 points.
It had risen 1.39 per cent last week.
An average of 307.9 million shares were traded on the southern exchange during each session last week, worth VNĐ6 trillion (US$259 million).
Meanwhile, the minor HNX-Index on the Hà Nội Stock Exchange increased 0.73 per cent to end Friday at 139.31 points.
The economic and diplomatic policies of the US to Việt Nam in recent years changed little regardless of which party takes and controls the State power, said Nguyễn Hồng Khanh, head of market analysis at Việt Nam International Securities Joint Stock Company (VIS).
“Over the years, no matter which party was in power, the relationship between the US and Việt Nam has been increasingly strengthened in many fields and this is an advantageous point for Việt Nam in the long term,” he said.
“The point to be noted is the new US policies to other countries can affect Việt Nam in the global linkage,” he said.
“From an investment perspective, I think the US presidential election is an event with short-term effects, thus after the election ends, the cash flow will return to the market after investors remove the previous cautiousness,” he said.
Sharing the same idea, Vũ Thị Thu Thuỷ, Head of Personal Banking Analysis at HCM City Securities Corporation said the US election will not have a great impact on the Vietnamese stock market.
“Vietnamese investors have experience with the same kind of events such as Brexit and the US election in 2016. The 2016 election results also surprised the Vietnamese market, but soon after that the market regained its balance,” Thuỷ said.
“The Vietnamese market itself has certain attractive factors that foreign investors value such as a stable macro environment, high potential growth, attractive valuation, stable geopolitical situation and the emergence of a large middle class,” she said.
“In terms of size, liquidity and valuation, Việt Nam’s stock market is even more attractive than some other Asian countries such as Singapore, Indonesia, Malaysia, and Thailand,” she said.
“The VN-Index is forecast to continually oscillate between the support zone of 900-910 points and resistance of 940-945 points next week,” said Trần Xuân Bách, a stock analyst at Bảo Việt Securities Co (BVSC).
“The result of the US presidential election may trigger wide fluctuations on global financial market and the Vietnamese stock market during early sessions this week,” Bách said.
“Besides, the market currently pays more attention to Q4 and 2020 business results of listed companies,” he said.
Since the second wave of COVID-19 pandemic in late July, the VN-Index rose by 15 per cent from 798 to 925 points at the end of October, which is much higher than to the US, China and other ASEAN stock markets, said Andy Hồ, Managing Director & Chief Investment Officer at VinaCapital.
However, during the time, foreign investors net sold $360 million, bringing the total net sales to $410 million since the beginning of the year, he said.
Foreign investors' net sales in Việt Nam's stock market was in the general trend of ASEAN countries in the context of the third wave of COVID-19 in the US and Europe, he said.
The remarkable growth of the Vietnamese stock market helped push the valuation of some blue-chips to higher levels. This triggered foreign investors to sell to seek profits, he said.
In the long term, we believe that Việt Nam is still the destination of choice for foreign investors as the country is controlling the disease well, having stable macro growth and corporate profits rise, he said.
Short-term risks might arise from the US election results that affects the US stock market's sentiment in November, thus the Vietnamese stock market could also be indirectly affected.
However, in the long term, whatever the result, it will boost the US economic and stock market growth. Therefore, the Vietnamese stock market will also benefit indirectly from the growth of the US market, he said. — VNS
