Vietnam Insight

▶ The market welcomed June with a session featured by moves within a narrow-trading range, and managed to close in the green color with the remarkable support of Energy and Real Estate sectors. Liquidity remained stable compared to the previous session and foreign investors continued their net selling streak were the highlights of today's session.

▶ At the end of the trading session, the VN-Index increased by 3.7 points (+0.28%), reaching 1,336.30 points; the HNX-Index increased by 2.95 points (+1.32%), reaching 226.17 points. Market liquidity reached VND23.15 trillion, which was equivalent to more than 1.1 billion shares being traded. Foreign investors net sold VND 211 billion on HOSE, mostly concentrated in HPG, VIC and MSB. On the contrary, typical net buying directions included SHB, EIB and VIX…

▶ Technical perspective: The market is generally in an accumulation phase around the old peak, liquidity has decreased slightly and is relatively stable. We expect the VN-Index to fluctuate around 1,300-1,330 points before being able to surpass the old peak. RSI is at a neutral level around 60 points.

In the positive scenario: The market manages to maintain the EMA50 against short-term profit-taking pressure, supported with positive information from tax negotiations. This will serves as a positive signal to help investors improve their confidence. 

In the base scenario: Vietnam has no new progress on tax agreements, the main trend would remain trading sideways and waiting for clearer signals from the market.

Strategy: Investors should temporarily stop buying new stocks that have experienced significant increases, because short-term cash flow can take profits and move to stocks that are trading below MA200/MA50. For new buying positions, priority can be given to real estate and banking groups that are moving in low price base with an accumulation base, however, the disbursement ratio should maintain at a low level.