The VN-Index continued its decline today, falling nearly 33 points, while the VN30-Index erased over 51 points as sell-off pressure showed no signs of weakening, especially among large-cap stocks. This followed a sharp drop on 2/3, when the VN-Index plunged by 36 points at one point. Though it later narrowed its decline and briefly turned green, strong sell-off pressure at the session's end pushed it to close at 1,846 points, down 34 points from its reference point. The VN30-Index, representing large-cap stocks, also fell by 51 points, a nearly 2.5% decrease.

Yesterday's end-of-day reports from analysis firms offered a common explanation for this trend: investor caution due to escalating tensions in the Middle East. Vietcombank Securities (VCBS) stated, "Recent geopolitical fluctuations in the Middle East have impacted investment sentiment across global financial markets, and Vietnam's stock market has not been immune to this effect".

Beyond Vietnam, Asian stock markets also opened in the red today. Japan's Nikkei 225 currently fell 0.89%. South Korea's Kospi Index lost 2.3%. Australia's S&P/ASX 200 declined 0.84%. These indices had already fallen during the first trading session of the week.

Investors are observing an electronic board at a securities company in Ho Chi Minh City. Photo: Quynh Tran

Regarding Middle East tensions, Rong Viet Securities (VDSC) suggested that in the short term, commodity prices for oil, gold, silver, and chemicals could continue to escalate due to psychological impact, supply disruptions, and logistics issues. Broadly, geopolitical shocks are often transmitted through three valuation layers: risk premium, inflation expectations and cost of capital, and growth repricing.

Based on this, VDSC believes global asset markets react defensively and adjust expectations. For crude oil, the initial reaction is typically price increases as the market raises supply risk, particularly with news concerning the Strait of Hormuz, oil and gas infrastructure, or the risk of vessel attacks. While the probability of the strait closing is low, maritime insurance premiums could rise, affecting transportation costs and supply chains.

Gold benefits from increased uncertainty due to safe-haven demand. The USD typically strengthens in the short term because of its reserve currency role, but subsequent developments depend on the assessment of campaign control and the risk of a prolonged conflict.

This international context impacts Vietnam, according to VDSC, through three main channels: oil prices increasing inflation expectations, transportation and insurance costs, and global risk appetite affecting capital flows. In a base-case scenario, where tensions escalate without major supply disruptions, the VN-Index could fluctuate with risk-off sentiment, while sectors benefiting from oil prices and freight rates might relatively outperform the market.

Therefore, this analysis group recommends that in the short term, investors prioritize risk management in a risk-off scenario by maintaining reasonable buying power. They should avoid chasing prices for speculative stocks when the next scenario remains unclear, especially commodity stocks highly reactive to conflict.

For those with a higher risk appetite, investors could strategically consider disbursing funds into groups directly benefiting from supply chain fluctuations, freight rates, and oil prices. Conditions for such investment include sufficiently cheap valuations and maintaining trading discipline.

While agreeing that sellers are dominating, Beta Securities (BSI) also noted surging matching liquidity, an increase of over 58% compared to the end-of-week session, indicating that cash flow is actively moving. Despite increased selling pressure, absorption demand also actively participated. Furthermore, foreign investors took advantage of the correction to disburse over 766 billion VND, partly showing that foreign capital is utilizing market volatility to accumulate at low price levels.

BSI's analysis team advises long-term investors to take advantage of corrections to gradually accumulate quality stocks at reasonable prices, prioritizing partial disbursements. For those with a short-term perspective, it is crucial to closely monitor cash flow movements, limit chasing prices, and consider taking profits on stocks that have met expectations. This group of investors is also recommended to maintain a reasonable cash proportion.

Tat Dat