Vietnam Insight

▶ The market continued with a sluggish trading session with liquidity at a record low. Most industry sectors fluctuated within a narrow price range,they recorded slight increases in the morning session but buying power weakened in the afternoon session. Foreign investors’ position were net-selling, although with a relatively insignificant value.

▶ At the end of the trading session, the VN-Index decreased by 1.03 points (-0.08%), reaching 1,315.20 points; the HNX-Index decreased by 0.17 points (-0.08%), reaching 226.23 points. The total market liquidity only reached VND 16.1 trillion, which was equivalent to about 707 million shares traded. Foreign investors net sold VND 159 billion, mostly concentrated in HPG, CTG and GEX.

▶ Technical perspective: The market recorded a sideways session within a narrow price range, maintaining a sideway trend between 1,290 – 1,340 points. Liquidity kept up the momentum to decline to below-average levels, indicating that both supply and demand showed hesitancy, while cash flow has not improved yet. Sideways is still considered as the main trend of the market, and the factor that could lead to a significant change in the trend has not showed itself up yet. 

- In the positive case: The market manages to maintain the EMA50 when facing of short-term profit-taking pressure from the market, along with positive information from tax negotiations from Vietnam. This will open up a positive signal to help investors confidently disburse in the upcoming time.

- In the base case: Vietnam has no new progress on tax agreements, the main trend will still trade sideways and waiting for a clearer signal from the market.

Strategy: Investors should temporarily stop buying new stocks that have increased a lot, because cash flow can take profits and switch to stocks that are trading below MA200/MA50. For new positions, priority can be given to stocks among the real estate and banking sectors that are in low price ranges, accompanied with tight accumulation bases. However, the disbursement ratio should also be kept low.