Vietnam Insight

▶ The VN-Index recorded a gain, approaching its previous peak around 1,880-1,900. However, high divergence remains a key factor at the moment, as the upward momentum lacks widespread coverage and is localized to a few specific stocks. Key stocks including VIC, SAB, NVL, and state-owned banks VCB, BID, CTG… played a supporting role in the index, while the consumer retail, chemical, and financial services sectors faced downward pressure. Notably, some electricity sector stocks fell sharply following news of an inspection of the electricity sector, also putting pressure on the market.

▶ At the close of trading, the VN-Index increased by 13.06 points (+0.7%), closing at 1,870.36 points; the HNX-Index decreased by 2.13 points (-0.83%), reaching 253.23 points. Liquidity across all three exchanges reached approximately 31 trillion VND, corresponding to over 1.1 billion shares traded. Foreign investors continued their strong net selling position today with a value of 1,659 billion VND, with the stocks experiencing the most significant net selling being FPT (-266 billion VND) and ACB (-176 billion VND). Conversely, the stocks experiencing net buying were PVT and DCM.

▶ Technical perspective: The VN-Index continued to experience a volatile session, fluctuating around the 1,860-point resistance level. During the session, the index briefly rose by over 20 points but quickly reversed course before recovering and closing in positive territory. Market liquidity improved, indicating buying pressure emerged as profit-taking emerged. In the short term, the index is likely to head towards its historical peak of 1,920 points before a correction. The nearest psychological support level is at 1,800 points, while deeper support is around 1,680 points.

In the underlying scenario: The ceasefire agreement improved investor sentiment, but the two sides have yet to reach a definitive agreement to end the conflict. During this volatile period, the VN-Index continues to head towards its previous peak of 1,920 points.

In a negative scenario: Prolonged disruptions in the Strait of Hormuz could further tighten global oil supply, keeping oil prices high for an extended period. This scenario increases the risk of stagflation (high inflation coupled with low economic growth). Historically, such environments are often unfavorable for the stock market and could lead to a deeper correction in the VN-Index. If the market continues to decisively lose the 1,580 support level, accompanied by weak recovery sessions, the downtrend could be further strengthened.

Strategy: Investors should limit chasing rallies and selectively choose stocks showing improvement in business operations. At the current stage, capital flows tend to favor sectors linked to domestic momentum such as public investment, banking, and construction materials. For the real estate sector, after a period of deep discounts, signs of capital inflow have appeared in recent sessions. Meanwhile, the securities sector continues to be supported by the market upgrade story, thereby maintaining a certain attractiveness to investors.