VN-Index, the benchmark index of southern Vietnam's Ho Chi Minh City Stock Exchange, has witnessed a remarkable downward trend in the past two weeks following the complicated development of the COVID-19 pandemic in the Southeast Asian country.

As of Wednesday noon, the index had lost over 10 percent since its peak of over 1,420 points on July 2, as more travel restrictions were announced to curb the spread of the latest COVID-19 outbreak. In the Wednesday morning session alone, the index fell 20.8 points, or 1.6 percent, to 1,276.74 points.

On Monday, Vietnamese shares nosedived as panic selling flooded the market amid the surge of local COVID-19 cases and fears of further economic pain from restrictions induced by the epidemic. The southern market benchmark VN-Index fell 3.77 percent on Monday, to 1,296.30 points.

Vietnam reported 2,383 new COVID-19 infections on Monday, the highest daily number ever registered since the pandemic hit the country in early last year.

Also on Monday, the Vietnamese capital Hanoi announced another suspension of in-store services of restaurants, cafes and barbershops amid increasing COVID-19 concerns, just three weeks after a similar restriction was lifted on June 22.

Last week, the index plunged over 5 percent with the largest fall of 4 percent on July 6, its biggest loss in a day since late January.

According to local securities analysts, the complex development of the COVID-19 on a large scale has been raising concerns among investors about difficulties in production and business activities, which would harm economic development.

The increasing pressure of selling weighing on most sectors was also among the main reasons for the declining trend.

The latest wave of COVID-19 infections hit Vietnam in late April, first in northern localities before spreading to southern and central localities, with over 31,000 locally transmitted cases registered as of Wednesday.

However, for weeks since April, regardless of negative forecasts, the stock market had been soaring to new highs, notably the peak of over 1,420 points on July 2.

Compared to its low of just over 660 points at the outset of the country's first COVID-19 outbreak in March 2020, the index had surged over 115 percent.

As a result, the market's short-term trend is currently rather negative as large-cap stocks are under strong selling pressure and had violated the short-term support zone, according to local experts.

In particular, the market may still see slight drops this week as the current demand is still not strong enough to help the index reverse. Therefore, it is likely to continue to correct to lower ranges to seek demands at low prices.

Investors are advised to remain cautious until there are enough support signals. To minimize risk, they should maintain the portfolio with stocks of 30 percent and lower, said Bao Viet Securities Company, a local investment advice company.

Those with a high proportion of stocks from 50 percent and above, especially investors using margin, need to sell to bring the portfolio back to a safe level. Meanwhile, investors who have a large cash position can consider opening a low-weight long position at the support zone of 1,240 to 1,280 points, according to the company.