Investors at the Bảo Việt Securities Company. Market analysts forecast the benchmark VN Index may move between 700 and 710 points this week. — Photo tienphong.vn

HÀ NỘI — The VN Index could move between the 700-710 point level this week on profit-earning after it corrected from a positive run in the post-Tet period, according to market analysts.

Việt Nam’s benchmark stock index dropped 0.2 per cent on Friday, to finish last week at 707.83 points. It had declined a total 0.5 per cent for two days, from a four-day rally of 1.6 per cent.

The two-day decrease also reduced its weekly gain to only 0.6 per cent from the previous week’s closing level.

The last two declining sessions were just technical corrections and the VN Index will continue to drop for a few days before rising again, according to Lê Đức Khánh, head of market strategy at Maritime Securities Inc.

“Market conditions have remained positive and the real test the VN Index will face is in the range of 725-730 points.”

Phan Dũng Khánh, head of investment consultancy division at Maybank Kim Eng Securities Company, said that investor confidence soared when the VN Index was near the level of 720 points on Friday.

However, when a few investors tried to offload their stakes in local stocks, the VN Index was pulled down to below 710 points at the end of day, causing investor caution, he said.

He added that that was only a short-term technical fall after the VN Index had gained big in the post-Tết period and market conditions would remain positive with increasing trading liquidity, net-buy trend of foreign investors and good performances by listed companies.

Agreeing with Khánh’s opinions, Dương Văn Chung, head of investment division at MB Securities Company, said that the most important factor that drives the stock market up is the strength of listed companies.

For the last few weeks, large-cap companies like brewer Sabeco and the two steelmakers Hoa Phat Group and Hoa Sen Group have reported big profits for 2016, he said.

These are the firms that have created a firm foundation to attract a lot of money from individual and institutional investors in both domestic and foreign markets, Chung said.

In Viet Nam’s securities market, foreign investors recorded a net buy value of VNĐ330 billion (US$14.66 million) last week, higher than the previous week’s net buy value of VNĐ88.26 billion.

Market trading liquidity also remained positive compared to the previous trading week. An average of nearly 174 million shares was traded in each session, worth VNĐ3.33 trillion. Those figures were 20 per cent in trading volume and 13 per cent in trading value.

Other securities firms also agreed that the stock market this week will be steady at the range of 700-710 points before rising again.

“The VN Index could fall back to 700 points early this week, and then rise back to 710 points,” Maritime Securities Inc said in a report.

The securities firm suggested to investors that they should be patient and hold on to the stocks in their portfolios before seeking opportunities to swoop in on declining shares. — VNS