An investor talks over the phone under an e-board showing stock indices. —VNA/VNS Photo

HÀ NỘI — The market ended the first trading week of September higher despite sharp volatility during the two sessions following the National Day holiday, with analysts watching whether the VN-Index can break through the 1,850–1,870-point resistance zone.

The VN-Index, representing the Hochiminh Stock Exchange (HoSE), closed the shortened trading week at 1,853 points, gaining nearly 21 points from its pre-holiday level.

On the Hanoi Stock Exchange (HNX), the HNX-Index, however, moved in the opposite direction, losing 2.24 points to 282.53 points, reflecting divergent movements across the broader market.

Selling pressure intensified immediately after trading resumed amid investor concerns over instability in international markets.

Foreign investors also returned to net selling, recording net outflows of nearly VNĐ1.5 trillion (US$57.6 million) across the two exchanges during the week. Of which, they net sold more than VNĐ1.4 trillion on the HoSE and nearly VNĐ45 billion on the HNX.

Following the strong recovery in August, the market has entered September in a more positive position but is approaching an important technical resistance area.

According to Viet First Securities (VFS), the VN-Index has regained key moving averages and maintained its bullish structure, although profit-taking pressure could increase as the benchmark enters the 1,850–1,870-point range.

VFS said the recent recovery had been driven primarily by domestic capital. Liquidity improved noticeably during advancing sessions, while foreign net-selling pressure had eased significantly compared with previous periods.

The firm also pointed to Việt Nam's inclusion in the FTSE Russell Global Equity Index Series (FTSE GEIS), scheduled to take effect from September 21, as a factor expected to provide additional impetus for foreign capital flows.

Market valuation remains another factor under consideration.

The benchmark VN-Index is currently trading at a price-to-earnings ratio of around 12.46 times, significantly below its 10-year average of 15.32 times, according to VFS.

However, capital flows have yet to spread evenly across the market. Banking, real estate and securities stocks continued to attract substantial liquidity during the latest advance, while money increasingly concentrated in large-cap stocks as the VN-Index approached resistance.

VFS said two factors would be in focus during September: whether the benchmark can successfully break through 1,850–1,870 points and the movement of foreign capital around the FTSE Russell GEIS rebalancing.

Under its positive scenario, a convincing breakout above 1,850–1,870 points accompanied by stronger liquidity and improved market breadth could allow the VN-Index to approach its previous high of 1,900–1,930 points.

A return of foreign capital and positive third-quarter corporate earnings prospects would support this scenario, the securities firm said.

Conversely, stronger profit-taking could emerge as the benchmark tests the resistance area. In that case, VFS said the VN-Index could retreat towards the 1,780–1,815-point zone before establishing its next trading pattern.

The securities firm said any corrections could provide opportunities to reassess stocks with sound fundamentals and reasonable valuations.

For portfolio positioning, VFS advised investors against chasing prices following the market’s recent strong advance.

It recommended maintaining equity exposure at around 40–60 per cent, with preference given to leading stocks that continue to maintain solid price bases, improving liquidity and positive business results.

New positions should be accumulated gradually, while investors should only significantly increase equity exposure if the VN-Index breaks convincingly above the 1,850–1,870-point resistance area with confirmation from trading liquidity, VFS said. — BIZHUB/VNS