Vietnam Insight

▶ After a recovery at the beginning of the week, the challenges were far from over as the VN-Index continued its correction, falling nearly 25 points to close at 1,782. Selling pressure intensified in the Brokerage sector, with declines ranging from 3-5%. The stocks experiencing the sharpest corrections were VIX (-5.1%), SHS (-4.5%), and VCI (-4.3%). Liquidity remained relatively stable around the 20-day average, a positive sign indicating that selling pressure wasn't overwhelming during the decline. Foreign investors widened their net selling position during the session, with net selling value reaching approximately 1,000 billion VND.

▶ At the close of trading, the VN-Index fell 24.51 points (-1.36%), closing at 1,782.12 points; the HNX-Index fell 6.27 points (-2.11%), reaching 291.07 points. Liquidity on all three exchanges remained flat at 16.6 trillion VND, corresponding to approximately 683 million shares traded. Foreign investors continued to net sell 970 billion VND. The stocks with the strongest net selling were FPT (-346 billion VND), PNJ (-108 billion VND), and SSI (-71 billion VND)... Conversely, typical stocks with net buying included HPG (+139 billion VND), BMP (+40 billion VND), and STB (+35 billion VND)...

▶ Technical perspective: The VN-Index traded with low liquidity in the morning session and only experienced a slight correction. However, selling pressure increased significantly in the afternoon session, causing the decline to spread across the market, with technology, real estate, and securities sectors experiencing the strongest downward pressure. The index once again retreated to test the MA200 line (around 1,770 points) but still closed above this support level. Technical indicators such as the RSI fell to 33, suggesting the market is approaching oversold territory and a technical rebound is likely in the coming sessions. However, to solidify the prospect of an uptrend in the second half of 2026, demand needs to significantly improve and spread at this crucial support level. If capital flows remain weak, any upcoming rebounds are likely to be technical rather than confirming a sustainable uptrend.

In the base medium-term scenario: In an optimistic scenario, a less stressful inflation outlook would create room for more flexible monetary policy, supporting market valuations. Businesses maintaining strong profit growth and trading at appropriate valuations despite high domestic interest rates could present good investment opportunities for the medium to long term. In this scenario, the VN-Index is expected to reach the 2,000-2,100 point range in the second half of 2026.

In a negative medium-term scenario: Conversely, if net selling pressure from foreign investors continues, and domestic interest rates continue to rise, leading to decreased market liquidity, the VN-Index may lack positive new capital inflows and is likely to consolidate sideways within the 1,750-1,850 point range in the second half of 2026. Furthermore, escalating geopolitical tensions between Iran and the US, along with the possibility of the Fed maintaining high interest rates, could be external factors contributing to this negative scenario, putting pressure on exchange rates and foreign capital flows into emerging markets like Vietnam.

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