Vietnam Insight

Stable market movements – BOE cuts interest rates. During regular trading on Thursday, the S&P 500 and Nasdaq Composite rose by 0.36% and 0.51%, respectively, while the Dow slipped by 0.28%. Those moves came as investors digested the latest batch of corporate earnings and economic data. US stock futures edged lower on Friday as investors prepared for the release of the highly anticipated monthly jobs report, which could influence the Federal Reserve's monetary policy decisions. Outside the Euro Area, British stocks received a boost from a dovish vote tally in the BoE’s expected 25bps rate cut.

Exercise caution when approaching resistance levels. VNINDEX closed at 1,271.48 (+1.87 points, +0.15%) with higher-than-average liquidity over 20 sessions. Blue-chip stocks made an effort to maintain the market's momentum, mainly led by bank stocks. The VN-Index continued to open with a gap up at the beginning of the session, however, the market quickly saw some selling pressure when it approached the resistance zone of 1275. With relatively weak cash flow, in the following sessions, the VN-Index may continue to fluctuate around the 1280 resistance zone as it repeatedly fails to test it.

Trading Strategy: The market is currently trending towards a sideways trading pattern. For short-term trading, investors can consider deploying capital around the 1,240-point range and gradually take profits as it approaches 1,300 points. With a buy-and-hold strategy, investors can deploy additional capital when the VN-Index breaks out of and successfully defends the 1,300-point zone.

Buy Recommendation: KBC