Vietnam Insight

Reinforcing rate cut expectations. US stock futures were little changed on Tuesday after equities advanced in the prior session, with investors bracing for a packed week of economic data headlined by two major inflation reports that could influence the interest rate outlook. The August producer price index is due Wednesday, followed by the consumer price index on Thursday. On Monday, the Nasdaq Composite climbed 0.45% to a fresh record high, lifted by chipmakers Nvidia and Broadcom, while the Dow and S&P 500 added 0.25% and 0.21%, respectively. Last week’s disappointing August jobs report, alongside softer labor market indicators, has bolstered expectations the Federal Reserve will cut rates at its September meeting, with markets increasingly betting on the possibility of a larger 50 bps move. 

Rally loses momentum. The VN-Index closed at 1,624.53, down 42.33 points (2.55%), with trading volume at the 20-day average. There were 56 advancing stocks and 285 declining stocks. The strongest contributors to the market's gain were SJS, HPG, and DXG, while VCB, VPB, and TCB were the biggest drags on the market. Foreign investors were net buyers of more than 993 billion VND, focusing on HPG and SSI.

Trading Strategy: Prioritize a holding strategy and be ready to sell once targets are met. For short-term traders, if the market corrects to around 1,600 points and rebounds, a small allocation can be considered. If the market returns to the 1,540-point area, there will be a clearer buying opportunity for medium-term positions. In addition, investors should maintain a balanced ratio of stocks and cash in their portfolios.