Vietnam Insight

▶ The VN-Index reversed course and declined during Tuesday's trading session as it approached its old peak around 1,770. Red dominated most sectors; the downward momentum was strongest in the early afternoon and narrowed towards the end of the session, helping the market close with a loss of just over 6 points. Bucking the general trend, VIC shares rallied by nearly 5%, lifting Vingroup's market capitalization to a new height. VPL continued to face net selling pressure from foreign investors, causing the net selling value of this block to surge to nearly 2,500 billion. On the other hand, total market trading value remained at a low base, though it showed improvement compared to recent sessions amidst increased selling pressure.

▶ At the close of the trading session, the VN-Index recorded a decline of 6.57 points (-0.37%), closing at 1,747.17 points; the HNX-Index fell 1.54 points (-0.6%) to reach 257.14 points. Market-wide liquidity increased slightly to 31.5 trillion VND, corresponding to over 1 billion shares traded. Foreign investors increased net selling with a net value of 2,455 billion VND, with VPL, VIC, and MSN being the most heavily net-sold stocks. Conversely, notable net buying included FPT, HPG, and POW…

▶ Technical perspective: The VN-Index experienced strong volatility as the index approached the resistance level of 1,770 points; at one point during the session, the market dropped more than 20 points, but by the close, a withdrawal candle appeared, resulting in a slight decrease of over 6 points to reach 1,747 points. Liquidity increased slightly compared to the 20-session average, indicating that demand emerged during the market correction. Regarding the trend, the VN-Index maintains a positive state as the index stands firm above the MA10 and MA20 lines, which are key support levels for the current uptrend. In the upcoming sessions, the market will continue to conquer the 1,750 point mark and requires market breadth and consensus, along with improved liquidity.

In the base case: The market has recovered positively and surpassed 1,700 (temporarily escaping the 1,600-1,700 point sideways range) with improved liquidity, better market breadth, and the return of foreign investors. We believe the market will face certain resistance when returning to the old peak and consolidate around 1,800 before cash flow improves after the Party Congress concludes in early 2026. With a double-digit economic growth target for 2026 and total market profit growth of over 18%, we expect the VN-Index could advance to the 1,900-2,000 zone in 2026.

In the negative case: Downward momentum continues to increase with trading volume growing on the downside, and no bottom-fishing force appears around the 1,550 - 1,580 point threshold. The market could then continue towards the 1,500 support zone and lower price ranges to test levels.

Strategy: Investors need to select suitable stocks in a context where the VN-Index score is strongly dominated by the performance of the VIC group. Medium and long-term investors can start partially disbursing capital into stock groups with good business results and sufficiently attractive discounts, such as banking, finance, and construction materials... Shorter-term investors can observe cash flow and price improvements to select stocks such as electricity, industrial parks, and technology...