Vietnam Insight

Fed kept interest rates unchanged. US stock futures edged higher on Thursday as investors evaluated earnings from major technology companies and the Federal Reserve’s latest policy decision. In after-hours trading, Microsoft jumped 9% after reporting results that topped analysts’ expectations, with strength driven in part by its cloud computing and artificial intelligence businesses. Meanwhile, Meta Platforms fell more than 6% as investors remained concerned about the company's ability to monetize its AI investments. Attention now shifts to earnings from tech giants Amazon and Apple later Thursday, along with results from major companies including Mastercard, Bristol-Myers, and Coinbase. Markets also continued to assess the Fed’s decision to keep interest rates unchanged, although three FOMC members voted in favor of a rate hike. During Wednesday’s regular session, the Dow dropped 2.19%, while the S&P 500 and Nasdaq Composite declined 1.52% and 1.74%, respectively. 

Short-term correction with expected technical rebound. The VN-Index closed the trading session at 1704.68 points (+24.06 points, +1.43%), with trading volume falling below the 20-day average. 195 stocks rose in price, while 128 stocks fell. Stocks positively impacting the index included VIC, VHM, and HPG; while LPB, VPB, and STB negatively affected the index. Foreign investors net sold nearly 88 billion VND, primarily buying HPG (141 billion VND), VIC (121 billion VND), and CTG (73 billion VND); and net selling VHM (234 billion VND - through negotiated sales).

Trading Strategy: Following the recent sharp correction, valuations of many stocks have become more attractive, creating opportunities to accumulate fundamentally sound companies with positive growth prospects. Investors may take advantage of market corrections to gradually deploy capital while maintaining an appropriate cash position to manage risk and remain ready to increase exposure once a recovery trend is confirmed. Investors should avoid using leverage (margin) to bottom-fish before the market confirms that the downtrend has ended.In addition, technical rebounds during this week could provide investors with an opportunity to restructure their portfolios by reducing exposure to companies whose business performance has fallen short of expectations.

Buy recommendation: LPB; Watchlist: HPG, POW, REE

High-risk stocks to avoid: Real estate (PDR, KDH, NLG), HDG and PNJ