Vietnam Insight

US equities extended their rally. US stock futures ticked higher on Tuesday after the major indexes kicked off the week with solid gains, supported by falling oil prices and a strong rally in heavyweight technology stocks. During Monday's regular session, the tech-heavy Nasdaq Composite surged 2.13%, while the S&P 500 and Dow advanced 1.48% and 1.32%, respectively. Megacap technology stocks drove the gains, with Amazon soaring 4.6% to surpass a $3 trillion market capitalization for the first time. Other standout performers included Microsoft (4.9%), Nvidia (2.9%), Meta Platforms (6%), Alphabet (4.9%) and Tesla (3.5%). Investor sentiment was also lifted by a roughly 5% drop in oil prices after President Donald Trump canceled planned strikes on Iran to revive negotiations, easing concerns over inflation and the outlook for interest rates. Attention now turns to another round of corporate earnings due Tuesday, including results from SpaceX, AMD, Caterpillar, Merck and McDonald’s, among others.

Range-Bound Trading with Resistance at 1,800. The VN-Index closed the trading session at 1762.84 points (+27.06 points, +1.56%), with trading volume improving above the 20-day average. 257 stocks rose in price, while 76 stocks fell. Stocks positively impacting the index included VCB, MBB, and FPT; while VJC, MCH, and VNM negatively affected the index. Foreign investors net bought nearly VND 1,073 billion, focusing on FPT, HPG, and VCB; and net sold NLG.

Trading Strategy: Investors may take advantage of market pullbacks to gradually accumulate positions while maintaining a prudent cash allocation to manage risk and preserve flexibility to increase exposure once a market recovery is confirmed. Investors should avoid using margin to bottom-fish, as the market may still be in the process of forming a second bottom. In addition, technical rebound sessions provide an opportunity to rebalance portfolios by reducing exposure to companies whose business performance has fallen short of expectations.

Buy recommendation: POW, PAN; Current portfolio: LPB; Watchlist: HPG, REE, NVL

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