Vietnam Insight

Highlights:

• In recent days, the interbank exchange rate has increased significantly, reaching around 25,200 VND/USD (the previous peak was 25,500 VND/USD). The current rate is only about 1% away from the peak. The SBV has responded by issuing T-bills, absorbing nearly 34,000 billion VND in the afternoon sessions of Friday (18/10) and Monday (21/10). This is the first time the SBV has used the T-bill tool to absorb liquidity in over 5 months.
• The SBV has also sold additional USD via spot transactions from October 24th at a rate of 25,450 VND/USD, aiming to curb the sharp increase in the exchange rate.

Technical view: The VN-Index closed the week at 1,252.72 points (-32.74 points, -2.55%) with low trading volume. The market has been consolidating within the range of 1,250 - 1,290 points, with a divergence between sectors. In particular, the banking and real estate sectors, which are the market's pillars, have experienced strong selling pressure. It is expected that the market will test the 1,240 level, which corresponds to the 200-day EMA.

Investment ideas: Investors should prioritize holding leading stocks such as those in the banking sector. Additionally, consider stocks with favorable Q3 business results and a good upward momentum when retesting the corresponding 200-day EMA. Expectedly benefiting sectors include banking, seafood, textiles, industrial zones, and steel.