Investors follow stock indices movements. — VNA/VNS Photo

HÀ NỘI — Given the signal that capital flow is still cautious, brokerages warned that the market might retreat to the VN-Index support level of 1,050 points and require additional investigation time before it can achieve equilibrium.

The market entered the week's final session in a cautious position due to the weakening trend from the end of the previous session. Exploration takes place for most of the trading session. However, supply pressure continued at the end of the session, particularly in some large-cap names.

The VN-Index closed at 1,055.3 points after losing 0.82 per cent. With 463.9 million shares matched on HOSE, liquidity somewhat improved.

“The downturn was sometimes restrained during the day, but the market remained cautious and continued to deteriorate as the session came to a close. The general market remained under pressure from large-cap stocks,” said Việt Dragon Securities Co.

“With the signal that capital flow is still cautious, it is possible that the market will retreat to the VN-Index's 1,050-point level of support and require additional time to investigate before it can strike a new equilibrium.

“Investors should therefore continue to monitor changes in supply and demand at the support area in order to reassess the market's health. Right now, it's important to take into account the risks of stocks that haven't yet accumulated and are facing intense selling pressure.

“The market's correction has not ended yet as the market continues to retreat with liquidity at an average low level. This shows that the support cash flow is still cautious, although it is close to the important support area of 1,050 points of the VN-Index. With this development, it is expected that the market will continue to go backwards to explore this support level in the near future. Therefore, investors still need to observe the supportive move to assess the market status,” it said.

According to Mirae Asset Securities (Vietnam), since the end of 2022, in the face of inflation and exchange rate pressure, banks have had no choice but to increase deposit rates to improve liquidity.

With better macro stability compared to 2022, the market in the first months of the year is expected to continue to attract capital inflows. However, Mirae Asset Securities (Vietnam) is seeing many fundamental changes, so investors must be more cautious now.

After the previous strong rally, profit-taking actions is now putting pressure on the general market, especially in large-cap stocks. Moreover, the unsatisfactory fourth-quarter business results will soon push down market valuation.

Therefore, investors should be more selective, paying close attention to assess the intrinsic value, growth prospects and asset quality of each individual stock before making an investment decision.

According to Saigon-Hanoi Securities Co (SHS), the VN-Index is about to reach the support level of 1,050 points and is in danger of returning to the downtrend state. Under technical analysis, the correction process is inevitable after a strong recovery period.

SHS expects the market, after the current correction, will continue to make efforts to recover and find the balance area for medium-term accumulation.

With a medium- and long-term perspective, the market cannot create an uptrend in the near future. The VN-Index needs another balancing and accumulating phase before the next uptrend period. — VNS