Vietnam Insight

Concerns over inflation and higher interest rates persist. US stock futures moved lower on Thursday as disappointing earnings from major technology companies pressured market sentiment. In after-hours trading, Broadcom sank nearly 14% after reporting fiscal second-quarter revenue below expectations, while cybersecurity firm CrowdStrike dropped more than 11% following soft second-quarter sales guidance. The weakness spread across the tech sector, with Intel (-2%), AMD (-2.9%), Palantir (-1.5%), Qualcomm (-1.9%), and Arm Holdings (-4.3%) also posting notable losses. Investors were also assessing heightened geopolitical risks after fresh exchanges of strikes between the US and Iran, undermining hopes for a peace deal and stoking concerns about inflation and higher interest rates. In Wednesday’s regular session, the Dow fell 1.21%, the S&P 500 lost 0.74%, and the Nasdaq Composite declined 0.89%. Six of the 11 S&P sectors closed lower, led by technology, financials, and consumer discretionary stocks.

Accumulating ahead of a breakout. The VN-Index closed the trading session at 1,819.01 points (-7.46 points, -0.41%), with trading volume remaining below the 20-day average. 173 stocks rose, while 133 declined. Stocks positively impacting the index included GAS, ACB, and MBB; while VIC, VHM, and LPB negatively affected the index. Foreign investors net sold VND 685 billion, mainly focusing on ACB and VHM. Meanwhile, they net bought FPT (VND 567 billion).

Trading Strategy: 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. Investors should limit the use of margin when the trend is not clearly defined during this period.

Sell Recommendation: PC1 PDR

Current trading portfolio: VGC, PC1, PDR; Watchlist: HPG,  KDH, MBB, CTD