An investor follows stock movement on a computer screen (Photo: tinnhanhchungkhoan.vn) Thebenchmark VN-Index on the Ho Chi Minh Stock Exchange had gained 0.58 percent toend the last trading session of 2020 at 1,103.87 points.
Bythe end of 2020, the VN-Index had increased by 142.88 points, equivalent to14.87 percent compared to the end of 2019. The minor HNX-Index had gained 98.1 percent,UPCoM-Index 31.6 percent.
Liquiditywas also a highlight in December and 2020 as a whole. In the last month of theyear, the total trading volume on the HoSE reached nearly 17.6 billion shares,an increase of nearly 70 percent compared to November.
Theaverage trading value in December also soared by 62.5 percent month-on-month.All 23 trading sessions of December recorded a daily value of more than 10trillion VND, an unprecedented value reported in the history of Vietnam's stockmarket.
“Themarket is expected to rally in the first trading session of 2021. VN-Index willchallenge the resistance zone of 1,110-1,130 points in the short term,” saidTran Xuan Bach, a stock analyst at Bao Viet Securities Co.
“Theindex is likely to face heavy shaking and correcting pressure during itsuptrend since overbought stocks have spread across the board. The domestic cashflow will support the market uptrend,” he said.
“Investorsmay start to pay attention to the fourth quarter and full-year 2020earnings seasons of listed companies.
“Thestock exposure should be maintained at 30 percent-50 percent of the totalinvestment. Investors with high stock exposure should consider lowering stocksproportion of short-term positions when the market approaches the resistancezone we mentioned.”
Accordingto Bao Viet Securities Co, Vietnam’s Stock Market closed an impressive year,growing by almost 15 percent from end-2019.
BVSCsaid that the positive factors to support the 2021 stock market included cheapmoney, which is still a great cushion for the global market in general and Vietnam'sstock market in particular.
In2021, the interest rate level in Vietnam may stay as slow as it was at the endof 2020. As the year goes on, the interest rate may inch up as the credit andinvestment demand of businesses regains, the company said.
Vietnam’sGDP growth will rebound strongly from the low base of 2020 thanks to therecovery of construction and service sectors along with the improvement ofdomestic consumption, investment capital, and export.
“Weforecast 2021 GDP to grow by over 7 percent,” it said.
“Foreigncapital inflows are expected to emerging markets, including Vietnam. Besidesthe cash flow trend into emerging markets, we think that the prospect ofupgrading Vietnam's stock market from a Frontier Market to a Secondary EmergingMarket also supports the stock market to attract foreign capital inflows nextyear.
“Profitgrowth of listed firms is forecast to recover strongly from the low base of2020, with profit growth of up to 25 percent. However, given the current strongrallied market making as many stocks quickly reach and surpass their valuationprices, this may partly increase risks and reduce the attractiveness of thestock market in the short-term.
“Wealso need to note some potential risks such as US-China relations tensions,rapid inflation and central banks of major countries raising interest ratesearly than expected, reducing money injection. The probabilities of these risksare currently rated at a low level, but if they happen, all these risks cannegatively impact the movements of the global financial market in general aswell as Vietnam's stock market.”
Regardingthe market expectation in 2021, KB Securities Vietnam Co (KBSV) forecastVN-Index will expand its gain thanks to many positive supporting factors.
Accordingto KBSC, the VN-Index recovered strongly and surpassed pre-pandemic levels, butthere is plenty of room to expand more in 2021.
KBSVexpected that the COVID-19 pandemic would still be effectively controlled in Vietnamand the vaccine may be distributed evenly by mid-2021, curbing the pandemic.
KBSVexpects that the VN-Index will surpass its historic peak of around 1,200 pointsin 2021 before experiencing some correction pressure.
However,KBSV said the first quarter of 2021 was considered the most potentially riskyperiod for the market because the number of cases of infection worldwide wasstill rising and can slow down the economic recovery process.
However,this was considered a good opportunity for investors to increase and reopentheir proportion if the market falls, it said./.
VNA
