Despite investor fears, the stock market has seen an increase of approximately 1.1 percentage points in the VN Index in May. Although, it is the influx of short-term capital that has been driving the markets during this subdued phase.
The Government is focused on removing difficulties and obstacles for the capital market in 2023. It wants to remove obstacles in cash flow, support businesses, and improve competitiveness to boost the economy.
Many giants on the stock exchange saw a drastic fall in stock prices in 2022, with losses amounting to more than US$11 billion. This sharp correction of the stock market last year also caused huge losses for several retail investors as well.
The VN Index is ranked among the group of stocks with the strongest decline in the world of 42 percent since the beginning of the year. However, besides plummeting at some sessions, the VN Index is also unbelievably gaining in some sessions as well.
Although the VN Index has returned to an attractive level compared to previous sessions, issues such as low-levels of liquidity and corporate bonds risks still need to be resolved for the market to once again gain momentum.
During the last seven to eight trading sessions, the VN Index suddenly went down and then up again to bottom at 1,150 points. The Index almost stood still and always looked like it was going to break bottom. This resulted in a loss of liquidity in the stock market that left several investors doubtful.
The first months of 2022 have been turbulent times for the stock market; the market has been volatile in recent sessions. In addition to the influence of cautious psychological factors, many investors have been greatly affected by fake news and rumors on social networks. Accordingly, Ms. Ta Thanh Binh, Director of the Securities Market Development Department under the State Securities Commission advised stock investors should be alert to fake news and rumors to avoid psychological impacts leading to mistakes in investment decisions.
Vietnamese shares are forecast to extend their growth in the final week of August by a marginal rate while volatility is widely expected by analysts as buyers are believed to be cautious due to the lack of news that could bolster optimism in the market.