Vietnam Insight

Little Movement Ahead of Trade Talks. US stock futures were little changed on Tuesday as markets awaited developments from trade talks between the US and China taking place in London. Treasury Secretary Scott Bessent and senior officials met with their Chinese counterparts on Monday to discuss rare earth shipments and the potential easing of export restrictions, with further negotiations expected early Tuesday. On Monday, the S&P 500 and Nasdaq Composite posted modest gains of 0.09% and 0.31%, respectively, while the Dow closed flat, reflecting a cautious start to the week. In corporate news, Apple fell 1.2% amid a lack of major AI announcements at its WWDC event, while Qualcomm jumped 4.1% on its $2.4 billion acquisition of Alphawave. Looking ahead, investors are focused on small business sentiment data due Tuesday, along with key inflation reports later in the week. Earnings results from GameStop and J.M. Smucker Co. are also on the docket.

Resistance around the recent peak. VNINDEX closed at 1,310.57, down 19.32 points or 1.45%, with liquidity below the 20-day average. The market saw 84 advancing stocks and 241 declining stocks. The correction was primarily driven by the real estate and banking sectors. The stocks contributing most significantly to the market's gains were FPT, HPG, and FRT, while VIC, VHM, and TCB were the biggest contributors to the decline. Foreign investors net sold 337 billion VND, primarily concentrating on SHB and HAH.

Trading Strategy: Investors are temporarily holding off on buying stocks that have already seen strong gains, as capital may shift toward stocks trading below their 200-day or 50-day moving averages. For new buying positions, priority can be given to real estate and banking stocks that are trading at low levels with a consolidation base; however, the allocation should remain modest.

Buy Recommendation: HPG