Vietnam Insight

▶ Continuing its recovery, the index maintained its positive momentum on Tuesday, closing at 1,869, a gain of over 11 points, although it briefly approached 1,890 during the session. However, most stocks did not perform proportionally with the overall index, with market breadth heavily skewed towards declining stocks, with 210 falling and only 99 rising. VIC continued to dominate the index, contributing nearly 16 points, exceeding the overall increase in the VN-Index. Conversely, oil and gas stocks faced strong selling pressure as oil prices continued to fall amid hopes of a formal agreement between the US and Iran. The new circular on increasing the ratio of short-term capital for medium- and long-term loans also had a positive impact on the banking sector, making it the second bright spot alongside VinGroup. Liquidity remained low, excluding block trades, indicating continued caution.

▶ At the close of trading, the VN-Index rose 11.13 points (+0.6%), closing at 1,869.04 points; the HNX-Index increased 5.32 points (+1.66%), reaching 326.38 points. Total trading volume across all three exchanges reached 33 trillion VND, equivalent to approximately 1.06 million shares traded. Foreign investors net bought 1,512 billion VND during the session; however, excluding the block trade in VIC worth 2,100 billion VND, they were still net sellers of over 500 billion VND. The stocks with the strongest net selling were HPG, TCB, and MWG; conversely, stocks with net buying besides VIC included LPB and BID.

▶ Technical perspective: The VN-Index experienced significant volatility during the session, at one point rising nearly 25 points and approaching the important resistance zone of 1,880–1,900 points. However, increased profit-taking pressure at high price levels caused the index to significantly narrow its gains, closing the session with only an 11-point increase. Market liquidity improved significantly compared to previous sessions, reflecting increased capital participation, with banking and securities stocks playing a leading role.

In the coming period, we expect the VN-Index to continue its positive trend and aim for the next resistance zone around 1,850 points. Improved liquidity will play a crucial role in strengthening investor confidence and confirming the return of capital, thereby supporting the index to complete its current consolidation phase and extend its upward momentum in the next period.

In the base-case scenario: A peace agreement between the US and Iran could help reduce inflationary pressure, improve global growth prospects, and support capital flows back to emerging markets, including Vietnam, in the second half of 2026. Furthermore, Vietnam could be added to MSCI's upgrade watchlist and begin receiving passive capital inflows from September 2026 after being upgraded to emerging market status by FTSE. In this scenario, the VN-Index could aim for the 2,000–2,100 point range.

In the negative-case scenario: Global reserves have decreased sharply during the recent war. If no agreement is reached in June-July, oil prices are likely to surge during the peak summer months. With these negative developments, risky assets in general and the VN-Index face a deeper correction (retesting the 1,580 point level).

Strategy: During this period, investors can focus on selecting stocks with sideways consolidation price structures and strong business growth, rather than solely focusing on the VN-Index's fluctuations (recent gains are largely driven by the VIC group). Based on our observations, many stocks in sectors such as real estate, banking, construction materials, and securities have consolidation price structures, improving business results, and are suitable for investors to invest in anticipation of Q2 and Q3 2026 earnings. Investors should limit the use of margin trading during this period when the trend is not clearly defined.