Vietnam Insight

Highlights:

• The U.S. Treasury Secretary predicts the Fed will cut interest rates by 0.5% starting in September of this year, based on a weak labor market and lower-than-expected inflation.
• Regulations in Article 7, Circular 23/2025/TT-NHNN, allow a 50% reduction in the required reserve ratio for credit institutions that compulsorily acquire failing commercial banks under special control. The new rule officially takes effect on October 1st. VCB, MBB, VPB, and HDB are large banks that will directly benefit from this policy

Technical View: The VN-Index closed the week at 1,630 points (+55.05 points, +3.4%), with the market's focus on the banking sector. Liquidity remained above the 20-day average, indicating strong demand pushing the market to its highest point. The index is still tracking the support line on the trend channel and maintaining an uptrend. The nearest support level is around 1,600 points, with a further level at 1,550 points. Investors should manage their risk if the VN-Index reverses and breaks below the trend channel support at 1,510 points with high liquidity.

Investment Idea: During technical corrections to the 1,510-1,550 point range, investors can consider a partial disbursement into stocks with strong business results that are expected to benefit from a potential market upgrade. If institutional money doesn't return in the 1,450-1,510 point range, investors might want to reduce their stock holdings to manage risk. We still believe there are good buying opportunities in the industrial real estate and retail sectors, and we hope this correction will open up a chance to buy back into the securities sector.