As the coronavirus is going global, the local stock market is forecast to experience continued volatility next week, according to securities firms.
An electronic board shows stock prices at Maybank Kim Eng securities firm. The local stock market is forecast to experience some downbeat trading sessions next week
The VN-Index of the Hochiminh Stock Exchange is expected to retest the support range of 865-880 points next week, Tran Xuan Bach at the macro and market research department of Bao Viet Securities Company said in a report.
Strong selling by foreign investors and particularly the global spread of the the virus, which causes the disease Covid-19, will put a crimp in global and Vietnamese economic growth, Bach said, adding domestic firms will be heavily affected and this will in turn pile pressure on the stock market.
In the days to come, stock exposure should be maintained at 15% to 25% of the portfolio, according to brokerages. Investors with high stock exposure should sell shares when the market rallies. Investors with a high cash proportion should wait and see.
Viet Dragon Securities Company predicted that the VN-Index would fall into negative territory next week. Investors should use caution and wait for more positive signs, the firm proposed.
However, according to analysts from Saigon-Hanoi Securities Company (SHS), the benchmark index may rebound toward the psychological level of 900 points next week after it tests a 200-day moving average successfully.
The VN-Index closed the session at 882.19 points on February 28, down 16.25 points, or 1,81%, against the day earlier. Market breadth was negative as 294 stocks decreased and 81 others rose. Lender STB again took the lead by liquidity with 11.9 million shares traded.
The HNX-Index on the Hanoi Stock Exchange gained 0.31 point, or 0.29%, at 109.58. There were 65.54 million shares worth VND702.1 billion changing hands on the northern bourse, soaring by 56.3% and 53.3% versus the day earlier, respectively. SGT
The fears of coronavirus have clouded prospects for the global economy and caused difficulties for Vietnam's stock market.
US shares slide as fears over the impact of the coronavirus continue to grip investors.