Vietnam Insight

Highlights:

• Today (May 12), the US and China announced that the two countries have agreed to significantly reduce tariffs on each other’s goods for an initial period of 90 days.
• US inflation unexpectedly eased in April, rising only 2.3% year-on-year, below the Dow Jones forecast of 2.4%.

Technical view: The VN-Index closed the week at 1,301.3 points (+34.09 points; +2.69%) with sharply increased liquidity. The market’s uptrend this week showed better breadth as many blue-chip stocks in the banking, retail, and information technology sectors rose by 3–4%. However, profit-taking signals appeared on Friday, after the index had already gained for two consecutive weeks. In the base-case scenario, we expect the market to trade within the range of 1,260 to 1,300.

Investment ideas: Investors are advised to reduce weightings or take profits on short-term holdings in the coming week. At the same time, there remain opportunities in sectors such as industrial parks and exports (which have not yet seen significant recovery recently), amid tariff negotiations favorable to Vietnam.