20160514_BSC_Vietnam Daily Review_EN_Technical shakes will occur more frequently

Summary

VN-Index rose in the morning session but could not maintain the green color till the end of the afternoon session and closed lower than 610 pts., decliners overwhelmed gainers. Both index’s volume (+ 22%) and trading value increased sharply (+20%). Steel producer stocks (-2.1% HPG, VGS -5.5%, -6.8% TLH, HSG -2.5%) and sugar stocks (-4.0% SBT, KTS -3.3%, -1.6% LSS) have been sold off sharply. STB reached ceiling price with trading volume surged. In contrast, HNX (+0.3%) and Upcom (+0.7%) continued to gain with trading volume and value remained at a high level. On Upcom, MSR experienced the 3rd consecutive increase (+11%) and volume rose strongly (+37%). The positive point today is that foreign investors maintained net long position on all 3 floors.

Recommendation

We believe that the market will have more technical shakes as the VN-Index is moving toward the higher points. However, the rapid recovery of the market in technical correction indicates that the demand is still large, helping indices not to fall so deep. Resistance 630 points is a very strong resistance as it is the long-term peak of VN-Index, therefore, investors can take advantage of the technical correction to increase the proportion of shares take profit in the up sessions.