Vietnam Insight

▶ The market maintained its upward momentum on Wednesday, closing up 7 points. The banking sector was a highlight, with many stocks showing strong gains and contributing significantly to the VN-Index's rise, notably VCB, TCB, VPB… The oil and gas sector also performed quite positively on expectations of strong profit growth in the second quarter, exemplified by BSR with a price increase of over 5% and estimated profits quadrupling. Market liquidity remained flat, indicating no significant improvement in cash flow. Foreign investors reversed their position to net buying, although the net buying value was limited.

▶ At the close of trading, the VN-Index rose 7.2 points (+0.39%), closing at 1,867.21 points; the HNX-Index remained unchanged at 313.16 points. Liquidity across all three exchanges reached VND 18.6 trillion, equivalent to approximately 695 million shares traded, similar to yesterday's level. A positive sign was that foreign investors reversed to net buying, with a net purchase value of VND 330 billion. The stocks with the strongest net buying were VPB, HDB, and VIC; conversely, the stocks with the strongest net selling included VHM, HPG, and VNM.

▶ Technical perspective: The VN-Index rose mainly due to the support of large-cap stocks, while liquidity remained low. The market continues to be in a state of fluctuation due to a lack of leading momentum, but capital flows are showing signs of improvement and are gradually concentrating on the financial sector, especially banking and securities, thereby creating expectations of positive spillover effects in the near future.

In the short term, we believe the VN-Index will trade around the 1,850 – 1,870 range and will still heavily depend on the fluctuations of the Vingroup group. The market is currently awaiting sufficiently strong catalysts from business results, macroeconomic policies, or new capital inflows to trigger the return of capital flows into sectors other than Vingroup.

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. Besides external factors, the domestic market is also supported by policies promoting economic growth, abundant liquidity, and expectations of increased passive capital flows after Vietnam is officially upgraded to emerging market status by FTSE Russell from September 2026. The synergy of these factors could create momentum for the market to enter a new growth cycle, with the VN-Index aiming for a target range of 2,000–2,100 points in the positive scenario.

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

Strategy: Investors can focus on selecting stocks with sideways consolidation and strong business growth rather than solely focusing on VN-Index fluctuations for medium-term positions. In the short term, consider stocks that have been heavily sold off and are showing signs of recovery, such as insurance, technology, and real estate stocks. Investors should limit the use of margin trading during this period when the trend is not clearly defined.