Stock market: Short-term correction, long-term development

Stock market drop points

Today (April 20), VN-Index continued to decrease by nearly 22 points, to less than 1,385 points. The strong selling increased only in the last 30 minutes so the index could not keep the psychological level of 1,400 points. This is the 5th session in a row in the last 8/9 losing streak, removing 140 points from the VN-Index and the second longest losing streak since the beginning of this year.

GAS, GVR and VHM are the three stocks that have the most negative impact on the VN-Index, when these three stocks alone caused the index to lose more than 8 points. Among the top 30 stocks in the market, also known as the VN30 basket, there were still 10 green codes, which could not resist the downward pressure of this afternoon session.

Small and medium-sized stocks are still the group under the most pressure when in the first 3 sessions of the week, an average of 150 stocks fell to the floor each session. The sale of mortgages, plus the sell-off sentiment in a part of investors are said to be the reasons why the market continued its strong decline in the afternoon sessions.

Mr. Do Bao Ngoc – Deputy General Director Securities Company Kien Thiet said: “Failure information in the market greatly affects investor sentiment. In negative psychological conditions, the process of mortgage settlement is prolonged and up to this point, the level of decline is large. Besides speculative stocks falling, blue-chip stocks have slowed down, even today many stocks have recovered.”

Foreign investors trust Vietnam

Psychology is always an important factor in every decision of investors in the stock market, especially when the market is in a strong correction like today.

While domestic investors sold off securities on the exchanges, foreign investors highly appreciated the recent moves to correct the market by the authorities. Expecting a transparent and potential market, foreign investors have continuously bought inflows in recent trading sessions.

Psychology is always an important factor in every investor’s decision in the stock market. Illustration.

GDP in the first quarter increased by over 5% over the same period, higher than the growth rate of the same period 2 years ago, showing a clear recovery momentum of the economy. From the beginning of the year until now, the average trading value per session on the stock market has reached 30,845 billion VND/session, up nearly 16% compared to last year. In terms of transaction size, Vietnam has now surpassed Singapore and ranks second in ASEAN, just behind Thailand.

The number of new accounts opened in the first quarter reached over 676.6 thousand accounts, equivalent to half of the new accounts opened in the whole of last year.

Mr. Tsuyoshi Imai – General Director of Japan Securities Company said: “The Government’s determination to sanction wrongful business owners has greatly increased the confidence of the international community. This is a necessary action. necessary for the Vietnamese market to step up a new ladder. I must say that in the long term these are very positive actions.”

Contrary to the selling force of individual investors, in the last 6 declining sessions, foreign investors net bought a total of more than 2300 billion dong.

Cheap valuation combined with an economy that is adapting to the COVID-19 epidemic, which is forecasted to have a fast recovery and economic growth in 2022, is a sustainable investment thesis of foreign capital inflows in the Middle and East. long-term.

Sustainable market development in the long term

The stock market, which wants to develop sustainably in the medium and long term, will not be able to have a place for “worms that upset the soup”. This is also one of the important measures in the development of the stock market that the authorities are promoting to implement, with particular emphasis on the determination to ensure transparency and sustainable interests for investors. investment.

In order to ensure the stock market’s stable and transparent development, from the beginning of the year, the Ministry of Finance directed the State Securities Commission to implement specific and synchronous solutions such as actively completing the legal framework for the securities market. the market and especially to step up the inspection, handling properly and hitting the violators.

Mr. Ho Duc Phuc – Minister of Finance said: “The Ministry of Finance will direct the parties to ensure support, supervise and check to avoid manipulation problems, especially stocks such as giving false information or using many abnormal trading accounts, manipulative acts must be severely punished. Enterprises that strictly comply with regulations must give their utmost support for the market to develop sustainably.”

The stock market, which wants to develop sustainably in the medium and long term, will not be able to have a place for “worms that upset the soup”. Illustration – Photo: VGP.

The new securities technology infrastructure system in the market is also being urgently completed, from which many new products will have a foundation for deployment, gradually professionalizing investment activities in the market.

Currently, the volatility of Vietnam’s stock market is still large because individual investors still account for about 80% of trading value in the market, so in the coming time, the State Securities Commission will continue to develop. and diversify investment fund types to improve the quality of investment demand, raise the investment ratio of the organization, towards sustainable investment demand.

According to SSI Securities Company, the fact that the authorities control the transactions of some groups of people manipulating the stock market as well as checking and correcting the issuance of corporate bonds of some enterprises only affect some securities codes. In addition, the decrease of the stock index is also due to the general trend of the world market.

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