Vietnam Insight

Escalating Middle East tensions. US stock futures slipped on Thursday as investors weighed earnings from major technology companies for signs that heavy AI spending is translating into stronger growth. Alphabet fell nearly 5% in extended trading after raising its full-year capital expenditure forecast despite better-than-expected cloud revenue, while Tesla missed earnings estimates and IBM lowered its annual sales outlook. Rising oil prices are also in focus, as escalating Middle East tensions and fading hopes for US-Iran peace talks fueled supply concerns. During Wednesday's regular session, the S&P 500 shed 0.1%, the Nasdaq 100 lost 0.5%, and the Dow Jones inched down. Software stocks led the decline, while most chipmakers rebounded and financials traded mixed. Markets now await earnings from Microsoft, Meta, and Amazon for further evidence that massive AI investments are beginning to deliver returns.

Short-term correction with expected technical rebound. The VN-Index closed at 1,668.53 points, down 62.03 points (-3.58%), with trading liquidity surging significantly. Market breadth remained overwhelmingly negative, with 75 gainers and 245 decliners. The largest positive contributors to the index were VNM, OCB, and VVS, while VIC (-25 points), VHM (-8 points), and VCB (-4 points) weighed most heavily on the index. Foreign investors were net sellers of VND 1.94 trillion, with net buying concentrated in VNM and HPG, while SSI, VIC, and VCB experienced the largest net foreign selling.

Trading Strategy: Investors may focus on stocks with sideways accumulation patterns and strong earnings growth. Gradual accumulation of deeply discounted stocks is a more suitable strategy than short-term trading while the broader market remains in a downtrend. Investors should limit the use of margin and avoid bottom-fishing until there are clear signs that the downward trend has stabilized.

Watchlist: HPG, POW, REE

High-risk stocks to avoid: Real estate (PDR, KDH, NLG) and oil & gas (GAS, PVS, PVD, ...).