Vietnam Insight

Mixed performance. US stock index futures edged higher on Thursday as the recent climb in Treasury yields paused, with the 10-year and 30-year yields holding below 5.3% and 5.7%. In Wednesday's regular session the Dow Jones fell 0.66% while the S&P 500 and the Nasdaq Composite each lost 0.22%. Treasury yields had reached their highest levels since 2002, while rising oil prices kept inflation concerns alive amid US-Iran tensions and shipping risks through the Strait of Hormuz. Levi Strauss dropped nearly 2% after hours after cutting its full-year revenue growth outlook. Investors await Thursday earnings from PepsiCo, Progressive and Delta Air Lines, along with the latest weekly jobless claims data.

Technical Rebound. The VN-Index ended the session at 1,753.3 points (-5.69 points, -0.32%), while trading liquidity fell back to a low level. A total of 150 stocks advanced, while 151 declined. VIC and VHM were the main detractors from the index, while GVR and MSN contributed positively. Foreign investors recorded net selling of VND 922 billion, mainly driven by heavy selling of PNJ.

Trading Strategy: We favor defensive stocks with low beta, strong cash flows, high dividend yields, and low leverage in a high-interest-rate environment. The insurance and utilities sectors could be considered. Given the lack of liquidity, the market remains vulnerable to sudden declines, making market pullbacks a more appropriate time to accumulate rather than chase rallies. In addition, investors should focus more on individual sectors and stocks than on the broader index, given the high level of market differentiation.

Current hodling portfolio: REE; Watchlist: TCH BVH, GAS; High risk stocks to avoid: PNJ NVL