20160705_BSC_Vietnam Daily Review_EN_Another new peak

Highlight

Strong cash flow continued to lift market up strongly even in new high despite the drag from VNM and the fall of global oil. VCB and banking sector continued leading index up in the session. After a correction in mid-morning, from red, strong demand pushed VN-Index rose strongly by 10 pts, reached high at 658.5 pts. Profit taking appeared in high zone in years was understandable, led the market back to 650 pts. The uptrend of the market was divergent as market breadth was fairly narrow. Because of divergence among the pillars, HNX-Index movement was weaker. Notably, there was a significant net selling of foreign investors on HNX, focusing on 3 NTP, KLS and NET with net sales value at VND 113 bil. After trading session, we had a notable announcement that Ministry of Finance lowered import tariffs which was basis for calculating fuel prices.

Recommendation

The index increased by 2.92 pts and failed to overcome the resistance at 660 pts. Market demand came back to positive. However, VN-Index still traded in risky area. The market may have to create a new price zone in the coming sessions before passing the resistances in short-term and investors may be interested in the fundamental stocks and large caps which are in temporary correction.