VN-Index poised for technical rebound after tariff shock, but risks remain

VN-Index poised for technical rebound after tariff shock, but risks remain

The tariff shock from the United States has pushed the Vietnamese stock market into a challenging phase, marked by heightened volatility and a prevailing sense of caution amid existing short-term risks.

An investor monitors the stock market. — Photo baotintuc.vn

Việt Nam’s stock market endured one of its most volatile trading weeks following the United States’ surprise announcement on April 2 of reciprocal tariffs of up to 46 per cent on Vietnamese exports — an event analysts have likened to a 'black swan' due to its suddenness and far-reaching impact.

The shock triggered a widespread sell-off that dragged the VN-Index from around 1,325 points to as low as 1,160 before partially recovering to the psychological support zone of 1,200 points.

By the end of the trading week, the VN-Index had fallen 8.11 per cent to 1,210.67 points. The VN30-Index, representing large-cap stocks, dropped 6.80 per cent to 1,280.52 points. Meanwhile, the HNX-Index also tumbled 8.9 per cent to 216.97 points.

Phan Tấn Nhật, Head of Market Analysis at Saigon – Hanoi Securities (SHS), said the unexpected scale of the US tariff announcement caused panic selling and triggered forced margin calls across multiple leveraged accounts.

The panic was evident in the surge in trading liquidity. On the Hồ Chí Minh Stock Exchange (HoSE), total trading volume exceeded 5.6 billion shares during the week, with the final two sessions each reaching nearly VNĐ40 trillion (approximately US$1.58 billion) — a record high in market history.

Foreign investors also aggressively divested, intensifying the market pressure. In the first quarter of 2025, foreign net selling on the HoSE totalled VNĐ25.9 trillion. In just the first week of April, this trend accelerated with an additional VNĐ6.5 trillion in net outflows.

Despite the turmoil, technical signals are now pointing to a potential short-term rebound. Analysts at Vietcombank Securities (VCBS) observed strong green candles with wide intraday ranges forming on hourly charts, along with improving money flow indicators — suggesting a resurgence in buying momentum.

In the final session of the week, the VN-Index posted a bullish candle, closing near its high and gaining 50 points on strong volume — a sign that buyers had clearly taken control.

Nonetheless, VCBS cautioned that downside risks remain. A 20-point price gap left at the opening of the April 3 session remains unfilled, implying residual selling pressure that could resurface. While a technical recovery may continue post-holiday, investor sentiment and capital flows should be monitored closely.

Taking a more cautious stance, SHS analyst Nhật added: “Although the VN-Index has bounced from the April low of 1,160 and retained its long-term uptrend from April 2020, the short-term trend is clearly weakening. The index has yet to reclaim the key resistance zone around 1,250, and forced margin selling still looms.”

Đinh Quang Hinh, Head of Macroeconomics and Market Strategy at VNDIRECT, warned that prolonged trade tensions could erode investor confidence, leading to higher risk premiums and asset price discounts. Industries most vulnerable include seafood, wood products, and industrial real estate — all of which are heavily reliant on exports to the US or FDI geared toward export manufacturing.

Conversely, he noted that sectors such as transport infrastructure, plastic piping and fertilisers are expected to face minimal direct impact.

Hinh also emphasised the importance of Government support in cushioning the blow. “Fiscal expansion and continued monetary easing will be key to mitigating the economic and market fallout,” he said.

With little clarity yet on the outcome of Việt Nam–US trade negotiations, analysts are urging investors to focus on risk management, avoid impulsive trading decisions and closely track macroeconomic developments — both domestic and international — as well as potential policy responses.

Bizhub