Vietnam Insight

Fed signals rate hikes. US stock futures rose on Thursday after the major averages came under pressure in the previous session, as the Federal Reserve signaled the possibility of a rate hike this year. In Wednesday’s regular trading, the S&P 500 and Nasdaq Composite fell 1.21% and 1.34%, respectively, marking a second consecutive day of losses for both benchmarks. The Dow also declined 0.97%, ending a four-session winning streak. The Fed’s June Summary of Economic Projections showed that half of FOMC members expect at least one rate hike this year, as underlying inflation measures continued to point to price pressures while labor market data remained resilient despite economic disruptions linked to the conflict in Iran. Meanwhile, the US and Iran digitally signed their interim peace agreement, although it remains uncertain whether Iran has already begun taking steps to fully reopen the Strait of Hormuz.

Accumulating ahead of a breakout. The VN-Index closed at 1,806.2 points, down 1.74 points (-0.1%), with trading volume remaining around the 20-session average. Market liquidity improved noticeably compared to the previous subdued trading sessions. A total of 174 stocks advanced, while 129 stocks declined. The main positive contributors to the index were BID, CTG, and VJC, whereas VIC, VHM, and HVN exerted the largest negative impact on the benchmark.Foreign investors recorded a net sell value of VND 3.13 trillion, primarily driven by VIC, which accounted for VND 2.19 trillion of net foreign selling.

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.

Current portfolio: MBB; CTD

Watchlist: HPG, KDH, SSI