20160804_BSC_Vietnam Daily Review_EN_Incomplete gain

Highlight

Today the market witnessed recover efforts after two consecutive sessions of strong decline, the cash flowed into big stocks such as VCB, VNM, BVH helped the VN-Index to increase by over 7 points, the trading was very active in the morning session. However, when approaching the resistance of 640, strong selling pressure appeared, plus the unstable market psychology made the VN-Index lose all the gain in the morning session, rose by only 0.33 points at the closing, reached the level of 631.94 points. HNX today went the same trends with the HoSE, however HNX-Index closed with a slight decrease by 0.1%, ITQ was the stock with biggest change in trading volume, about 16 times higher than yesterday. On foreign exchange markets, the focus is put on RMB when the exchange rate RMB / USD is adjusted to 6.6444, corresponding to a discount of RMB by 0.37%. The US dollar index gained 0.1% when besides the RMB depreciated against USD, USD also rose against the EUR, JPY and CHF.

Recommendation

The market recovered significantly in the early and middle of trading session when approaching 630 support before correcting sharply and lost nearly 8 points earned during the session, though trading volumes improved compared with the previous session it is still lower than the 10-day average. At the closing, VN-Index rose slightly to 631.9 points (+0.33). Despite the slight increase, the market breadth is quite negative with 94 advancers / 137 decliners. Many sectors continued to decline today, only the pharmaceutical (safe haven during correction), Oil (supported by the recovery of world oil price), banks and seafood was trading positively. The loss of almost 9 points earned during the session is a negative sign for the market in the following session. At the same time, the technical indicators have not really improved. Therefore, it is likely that the market will correct in the next sessions. Investors should keep the stock weights of portfolio at a safe level and wait for signals of market equilibrium.