Vietnam Insight

Core CPI growth slowed from the previous month – the market cheers. On Wednesday, the Dow surged 1.65%, the S&P 500 climbed 1.83%, and the Nasdaq Composite jumped 2.45%. The 10-year US Treasury yield also dropped sharply from a 14-month high, retreating to around 4.65%, which further fueled the risk-on sentiment in the market. The December CPI report showed progress toward the Federal Reserve’s 2% inflation target, with core CPI rising 3.2% YoY, down from 3.3% in November. This strengthens expectations that the Fed may continue its rate-cutting cycle throughout the year. The market rally was further bolstered by robust earnings from major banks.

Low spread with light volume. VNINDEX closed at 1,236.18 (+7.11 points, +0.58%) with liquidity around the 20-session average. The market had 287 green codes and 127 red codes. Foreign investors net sold 405 billion VND. Small fluctuations and low liquidity in recent sessions show that investors are still maintaining a wait-and-see attitude in the period before Tet Holiday.

Trading Strategy: The market is showing positive signs as it approaches the 1,200-1,220 point level. For short-term trading, investors can consider disbursing around this area and gradually taking profits when approaching 1,300 points. With a holding investment strategy, investors will only disburse strongly when the VN-Index breaks out and successfully defends the 1,300 point level.

Buy Recommendation: HPG