VN-Index struggles to make a big breakout

Fears of an economic collapse caused the US stock market to suddenly experience a sell-off, with several major indexes plummeting. This had a minor impact on the Vietnam stock market. The VN-Index fell precipitously at the start of the trading day on March 11 due to heightened selling pressure from investors, particularly those with large margins. But as the session came to a close, the market recovered and resumed its upward trajectory.

Support from the bank stocks

The following observations may be made from the March 11 trading session: First, despite the VN-Index's steep decline, liquidity instantly shrank, indicating that investors were not liquidating at any cost and that there was no selling pressure. Second, the bank stocks remained at the forefront of the recovery that followed.

With strong support from the bank stocks, the VN-Index has recovered and softly cleared the 1,300-point threshold, which was a major obstacle throughout 2024, according to stock expert Nguyen Van Binh, adding that this group of equities' recent upward trend is being driven by dividend speculation rather than low values based on P/E or P/B ratios.

According to rumors, a number of banks will pay out large dividends in both cash and stock. For example, MB Bank would pay out 37% in cash and 30% in stock, Sacombank will pay out 100% in dividends (10% cash, 90% stock), and ACB Bank will pay out 25% in dividends (10% cash, 15% stock).

Numerous sources had stated a few months prior that Vietcombank (VCB) had asked to pay a large dividend; this was confirmed when the bank formally distributed 49.5% of its shares, which caused the stock to begin to rise. In addition, reports that CTG (VietinBank) was asking for large dividends joined the group of equities that saw a 2024 increase. One of the main factors influencing the flow of money into other bank stocks is the price growth of these two stocks. Bank stock prices have risen by almost 10% since the start of 2025.

Investors should be more cautious

We have all observed the support from bank stocks in the stock market over the last several months, although it is not as strong as it was at the start of 2024. Significant momentum was generated by the bank stocks last year, drawing substantial cash inflows into the Vietnamese stock market that trickled down to several other firms. Many equities, including VTP, FOX, and ACV, had a significant increase in 2024.

In 2025, however, everything slowed down, and no equities really shone out; even the port and mining stocks, which had been increasing, hardly increased. According to stock market statistics, several equities with limited liquidity—like GEE, KSV, HGM, TRC, and TMT—saw significant gains. All of this suggests that significant capital flow has not yet reached the Vietnamese stock market, which hinders the VN-Index's ability to rise further. If it does, it may just be a "green shell, red heart" with the bank stocks serving as the shell, according to Binh.

Given the current state of global instability and the negative pressure on several stock indexes in both the Asian and global stock markets, the rising trajectory of the VN-Index may encounter substantial obstacles. The net selling by foreign investors is a further cause of this difficulty.

According to Binh's analysis of the technical chart, the VN-Index has crossed above the 1,300-point barrier, which may be regarded as a consolidation zone for the whole year 2024. As a result, cash flow will become more attractive, and liquidity will rise. This is really the case, with a trading value of around VND 20–21 trillion/session/HSX, which is almost 20% more than the prior level of VND 16–17 trillion/session. But this number isn't particularly important to make a bigger breakthrough for the VN-Index. Investors should thus use greater caution. The stock market will not be as profitable for investors in 2025 as it was in prior years.