HANOI: The VN-Index recovery last week brought short-term positivity, supported by favourable macroeconomic factors. However, market liquidity remains low, and risks persist.

Vietnam’s stock market enjoyed a week of positive recovery as the VN-Index surpassed the 1,250-point threshold.

By the close of the week, both the VN-Index and the HNX-Index recorded gains, rising by 1.82% to 1,250.6 points and 1.5% to 224.64 points, respectively.

The average daily trading value across the market last week was just over 10.13 trillion dong, marking a nearly 17% decrease. This is the lowest weekly liquidity level since May 2023.

Over the past eight weeks, the average daily trading value on the Ho Chi Minh Stock Exchange has not exceeded 15 trillion dong, according to Fiintrade analysts.

Prolonged low liquidity in the stock market, coupled with rising valuations in other asset classes like real estate, foreign currencies and cryptocurrencies, has raised concerns that capital is being diverted away from equities.

Phan Tan Nhat, head of analysis at Saigon-Hanoi Securities, described the VN-Index’s trajectory as largely positive.

The index was targeting the 1,255 to 1,260-point range, corresponding to the 200-day moving average and the 2023 peak. However, this range was also a strong resistance zone, with the nearest support level identified at around 1,240 points.

“While the VN30 index is showing signs of short-term declines, the VN-Index has maintained a broad accumulation channel throughout the year, fluctuating between 1,200 and 1,300 points,” Nhat said.

He added that the VN-Index’s potential to return to the 1,300-point level is supported by attractive valuations relative to Vietnam’s economic scale and projected gross domestic product growth of 6.5% to 7% for 2025.

Similarly, VNDIRECT Securities Corp

Macroeconomics and Market Strategy head Dinh Quang Hinh highlighted the positive momentum as domestic indices sustained their recovery, with the VN-Index reclaiming the 1,250-point mark.

According to Hinh, the market’s rebound has been supported by both domestic and international economic trends. — ANN