Vietnam Insight

Highlights:

The Fed kept interest rates unchanged for the fourth consecutive meeting, marking the first policy meeting under new Chair Kevin Warsh.

MSCI noted that Vietnam has made progress in foreign ownership regulations and disclosure requirements, although several market bottlenecks remain.

A number of FDI enterprises registered additional investments and announced production expansion plans in Vietnam.

The DMX IPO achieved a 93% subscription rate, raising more than USD 500 million.

Assessment: Overall market conditions remained largely neutral compared to the previous week. One positive development is the continued strength of Vietnam’s FDI inflows, with registered FDI in 5M2026 rising 34% YoY. In addition, upcoming IPOs and foreign stake sales are expected to attract further USD inflows into the country. Over the past week, investors have increasingly priced in a 25-basis-point Fed rate hike at the December meeting. We believe the possibility of further Fed tightening warrants close attention, particularly as both the BOJ and ECB have also raised interest rates. Investors should also monitor negotiations regarding the reopening of the Strait of Hormuz. If progress is made and accompanied by strong USD inflows into Vietnam, market sentiment could remain constructive.

Technical View: The VN-Index closed the week at 1,824.5 points (+32.88 points, +1.84% WoW) on the weekly chart, with slightly improved liquidity. Foreign investors remained net sellers. On the daily chart, the index has yet to reclaim its 50-day moving average (MA50). Market breadth has deteriorated further, as gains were largely driven by large-cap stocks. We expect the market to consolidate around the 1,850 level, corresponding to the MA50, in the near term.

Investment Ideas: Investors may consider accumulating stocks that are trading sideways or experiencing only mild corrections while continuing to deliver solid earnings growth, targeting medium-term opportunities. Increasing short-term trading exposure is not recommended while the broader market remains in a corrective phase. Investors should also avoid chasing rallies, as weak market breadth suggests that price advances may lack sustainability.