Vietnam Insight

▶ The market continued its upward momentum in Wednesday’s trading session, driven primarily by strong gains in banking stocks and VIC. VIC surged more than 4%, contributing 16 points to the VN-Index’s total gain of nearly 30 points. Several banking stocks also posted solid advances and attracted strong capital inflows, notably TCB, following news of a planned 15% stake sale to a strategic investor, as well as HDB and VPB. Overall, the VN-Index broke above the 1,800 resistance level and is expected to continue recovering toward higher levels. Market liquidity remained broadly in line with the 20-session average, while foreign investors returned to net selling, albeit at a modest scale.

▶ At the close, the VN-Index gained 29.91 points (+1.67%) to 1,821.32, while the HNX-Index fell 0.69 points (-0.24%) to 281.96. Total trading value across the three exchanges reached VND 20.9 trillion, equivalent to approximately 795 million shares traded. Foreign investors recorded a slight net sell value of VND 35 billion, with the largest net selling seen in CTG (-VND 78 billion), ACB (-VND 78 billion), and VHM (-VND 61 billion). On the buying side, the most notable net purchases were FPT (+VND 203 billion), TCB (+VND 130 billion), and PNJ (+VND 100 billion).

▶ Technical perspective: After several sessions of consolidation, the VN-Index officially broke through the psychological resistance level of 1,800 points, closing at 1,821 points, thereby reinforcing the positive short-term trend. Liquidity did not show significant improvement during most of the trading session, with stronger buying interest emerging mainly in the afternoon session.

Momentum indicators continued to improve. The MACD remained above its signal line, while the positive histogram expanded, indicating that buying pressure continues to dominate. Following this strong rally, the VN-Index is approaching the next resistance zone of 1,830-1,850 points, and short-term profit-taking or market volatility may emerge. In the event of a pullback, the 1,790-1,800 range is expected to serve as the nearest support zone, while stronger support is located around 1,760-1,770 points, corresponding to the MA10 and MA20 areas.

In the positive medium-term case: In an optimistic scenario, easing inflationary pressures would create room for more flexible monetary policy, thereby supporting market valuations. Companies maintaining solid profit growth and trading at reasonable valuations—despite persistently high domestic interest rates—may present attractive investment opportunities for the medium to long term. Under this scenario, the VN-Index is expected to target the 2,000–2,100 point range in the second half of 2026. However, any recovery sessions during the remainder of July must demonstrate strong "bottom-fishing" demand.

In the base medium-term case: Conversely, if net selling pressure from foreign investors persists and domestic interest rates continue to rise—thereby dampening market liquidity—the VN-Index may lack fresh, positive capital inflows. It would likely trade sideways within the 1,750–1,850 point range during the second half of 2026. Weakness in the VIC and VHM stock groups could cause the VN-Index to retest the lower bound of the previous sideways range—around the 1,580–1,600 point level. Additionally, renewed geopolitical tensions between Iran and the US, combined with the likelihood of the Fed maintaining high interest rates, could reinforce this negative scenario by pressuring exchange rates and foreign capital flows into emerging markets like Vietnam.

Strategy: Investors can capitalize on market corrections to deploy capital incrementally while maintaining a reasonable cash position for risk management, remaining ready to increase exposure once a market recovery trend is confirmed. Investors should avoid using leverage (margin) to "catch the bottom," as the market may form a secondary low. Furthermore, technical rebounds offer opportunities to restructure portfolios by divesting from companies that are underperforming relative to expectations.