Two investors on the exchange floor of  DSC Securities Corporation. Photo  DSC Securities Corporation

HÀ NỘI Shares are forecast to rebound this week amid rising demand to retest the supply at the area close to 1,080 points, said securities companies.

On the Hồ Chí Minh Stock Exchange (HoSE), the VN-Index lost by 0.12 per cent, to close at 1,067.07 points.

The weakening movement in Friday's session turned out to attract bottom-fishing demand and helped the market to significantly narrow down the drop at the end of the session.

“With existing support signals, it is likely that the market will continue to be supported and rally next week to retest the supply at the area near 1,080 points," said Việt Dragon Securities Co. 

"Therefore, investors need to observe the supply and demand movements at the resistance zone.

“For the time being, it is still possible to hold or exploit short- term opportunities in some stocks with good technical signals and attracting cash flow. However, it is necessary to consider the possibility of profit-taking at stocks that have recently risen to the resistance zone.”

According to Lê Anh Tuấn, director of Investment Strategy Planning at Dragon Capital Việt Nam, the stock market is now influenced by two factors: monetary policy and profit growth.

Tuấn said: “Monetary policy is following a good direction, but not loosening enough for stocks to grow. On the other hand, profit growth is still restrained, forecasting at around 5 per cent in 2023.”

The cycle of the stock market is divided into three phases: falling, bottoming and recovering – depending on five criteria of interest rates, exchange rates, liquidity, bankruptcy and profit expectations.

According to Tuấn, with the signal of falling interest rates, stable exchange rates, stable liquidity, and unclear profit expectations, the stock market is gradually moving from the bottom to the early stage of the recovery cycle.

He said: "If investors now still expect the market to drop another 15-20 per cent like in 2022, then I would say that it is unlikely to happen. Because in the context of policy shifting from very tight to relatively loosened, the market's downward momentum might slow down."

Regarding investment strategy, Tuấn believes that investors should balance their positions, which means not leaving the market but should not adopt short-term buying. This year might not expect too strong surges of the market as it is the year of accumulation, he said.

"This year investors should not expect 30-50 per cent of return. However, in 2023, if you see the market falling, start to accumulate stocks. This is a good time for us to accumulate for a strong growth phase in 2024", said Tuấn.

With the current support signal, it is likely that the market will continue to be supported and increase in the near future to re-test the supply at the area near 1,080 points, said Việt Dragon Securities Co.

“Therefore, investors need to observe the supply and demand movements at the resistance zone. For the time being, it is still possible to hold or exploit short-term opportunities in some stocks with good technical signals and attracting cash flow,” it said.

“However, it is necessary to consider the possibility of taking profit at stocks that have risen rapidly to the resistance zone recently.” VNS