VN-Index seeks equilibrium as Q1 earnings season expected to steer capital flows

VN-Index seeks equilibrium as Q1 earnings season expected to steer capital flows

Amid an increasingly attractive valuation base and stabilising investor sentiment, analysts believe banking, retail, aquaculture, livestock, and power sectors could lead any rebound, provided that reported profits surpass expectations.

Investors monitor the stock market. — Photo baotintuc.vn

Việt Nam’s stock market is forecast to consolidate within the 1,200–1,250-point range in the coming weeks, as investor focus shifts to the first-quarter earnings season.

Amid an increasingly attractive valuation base and stabilising investor sentiment, analysts believe banking, retail, aquaculture, livestock and power sectors could lead any rebound, provided that reported profits surpass expectations.

The Head of Macroeconomics and Market Strategy at VNDIRECT Securities, Đinh Quang Hinh, described the recent pullback from the 1,240-point resistance level as a healthy correction that helped absorb supply from short-term 'bottom-fishing' investors.

According to Hinh, the VN-Index is approaching a balanced supply-demand zone and Q1 earnings could offer a catalyst for recovery if results beat forecasts.

“As the market has returned to a more attractive valuation zone, positive earnings surprises could help lift investor confidence and raise the overall valuation baseline. Companies with expected strong earnings will likely attract increased capital inflows,” Hinh noted.

In terms of trading strategy, Hinh recommended that investors take advantage of any dips near the 1,200-point level to rebalance portfolios and increase exposure to fundamentally sound stocks in sectors with strong earnings outlooks.

However, he cautioned against the use of leverage at this stage, given lingering risks related to trade and tariff policies and the absence of a clear upward trend.

Echoing similar sentiments, the Head of Research at Saigon – Hanoi Securities (SHS), Phan Tấn Nhật, said the market is attempting to establish a short-term equilibrium around 1,200 points — a technically significant support level that aligns with the five-year average and marks both the 2018 peak and the November 2024 low.

“The market has been gradually stabilising after a period of sharp selling pressure. Earnings results for the first quarter, which are being released, are starting to improve investor sentiment. Additionally, optimism around potential progress in US–China trade talks is also offering support,” Nhật said.

Nonetheless, he advised investors to be selective, focusing on fundamentally strong, leading companies with long-term growth potential, rather than chasing short-lived rallies lacking solid fundamentals. In a market without a clear trend, maintaining a balanced allocation and flexible portfolio structure remains essential for managing risks effectively.

During the past trading week, the VN-Index showed mixed movements. It surged early in the week, briefly surpassing 1,240 points, before retreating due to renewed selling pressure, at one point nearing the psychological support level of 1,200 points. A modest rebound in the final two sessions helped the index close the week at 1,219 points, down just over three points from the previous week.

Market liquidity weakened, reflecting investor caution. On the Hồ Chí Minh Stock Exchange (HoSE), trading value slightly declined, while foreign investors continued net selling to the tune of over VNĐ4.8 trillion (US$185.1 million). 

Several export-related and FDI-oriented sectors such as industrial zones, aquaculture, textiles and agriculture posted decent gains at the end of the week.

However, select stocks within the technology, textiles and industrial real estate segments continued to face downward pressure.

Despite the lack of a clear recovery trend, analysts believe that upcoming Q1 earnings and improving market stability could support sentiment in the near term. Investors are advised to remain patient, monitor capital flows closely, and stay updated on macroeconomic developments to make informed investment decisions. 

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