Vietnam Insight

Highlights:

U.S. Treasury yields continued to rise sharply in May, with the 10-year yield fluctuating around 4.4%–4.6%. 

According to the meeting minutes, most participants believed that “further policy tightening may become appropriate” if inflation remains above the 2% target. 

Following PC1, the Chairman and Chief Accountant of Power Engineering Consulting JSC 2 were also prosecuted. 

General Secretary and President stated: “Housing is for living, not for speculation.” 

Assessment: The market experienced a correction in line with our expectations as the VIN-related stocks had shown signs of overheating in recent weeks. Capital flows need time to rotate into other sectors, making a short-term correction necessary. Over the past week, sector-specific news triggered sharp volatility across certain industries, though the impact was not widespread and overall market sentiment remained stable. We believe many sectors have yet to see significant gains, creating opportunities for accumulation. In the short term, however, the market may struggle to break out due to the lack of sufficiently strong and broad-based catalysts, with movements mainly driven by isolated news flows.

Technical View: The VN-Index closed the week at 1,877.1 points (-44.4 points; -2.31%) on the weekly chart. The market entered a correction phase as the VIN group lost momentum. Foreign investors recorded strong net selling on Friday, bringing the total weekly net selling value to more than VND 6 trillion. We expect the market to retrace toward the 1,850–1,800 range in the near term.

Investment Idea: Investors may focus on stocks with sideways consolidation patterns and strong earnings growth rather than concentrating solely on VN-Index fluctuations for medium-term positioning. In the short term, opportunities may emerge in heavily sold off stocks showing signs of recovery, such as insurance, technology, and real estate sectors.