VN-Index tests 1,800 points as FTSE reclassification boosts inflow hopes
FTSE Russell's inclusion of 27 Vietnamese stocks in the FTSE GEIS has raised hopes for stronger foreign inflows, but analysts say the VN-Index needs stronger fundamentals and liquidity to break above 1,800 points.
The VN-Index closed near 1,780 points last week, after surging 2.3 percent. This move pushed the index into a significant resistance zone, between 1,780 and 1,800 points, following a recent period of consolidation and correction. Analysts, such as Tien Phong Securities, state that the index needs stronger fundamentals and liquidity to break above this level and achieve a genuine trend reversal.
The current lack of liquidity is evident in the recent decline in trading volume and turnover on both the Ho Chi Minh City Stock Exchange and the Hanoi Stock Exchange. Despite the positive market recovery, investors are advised to wait for clearer signals before making further investments. The reclassification of 27 Vietnamese stocks into the FTSE GEIS has raised hopes for increased foreign inflows, potentially increasing Vietnam's weight in the index to 0.49 percent, from the earlier estimate of 0.328 percent.
However, analysts warn that additional catalysts, such as State divestments, will be necessary for a sustained market rally.
Written by urgent.news from SGGP English Edition Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
