20170320_BSC_Vietnam Daily Review_EN_Break the 715 resistance

Highlights

The first trading session after rebalancing portfolio of ETFs witnessed that VN Index closed at 715.07, going up by 4.52 points, compared to that on Friday last week. The index experienced a considerable increase at the beginning and had kept that momentum during the session with a wider amplitude, however VN Index lost its rally at the end due to making profit of investors. Market breadth showed positive signs because number of bullish shares (162 stocks) got dominant, compared to bearish ones (89 stocks). Liquidity maintained at a high level, implying VND 3,469.8 billion in trading value on HSX. VJC closed at its ceiling price, VND 125.700, becoming the leader in the increase of VN Index. Some bullish sectors were Securities (SSI, HCM), Bank (VCB, CTG, BID). For market capitalization, BCs was good at attracting the cash flow thanks to contributors such as BVH, SAB, HPG, HSG,…, but some stocks in this group also restricted the rally of the index, for instance: VNM, VIC, BHN. On HNX, HNX- Index closed at 89.07, going up by 0.94%, which has approached the strong resistance level at 90.

Recommendation

After the impact of ETF short-term rebalancing activities, the VN-Index had a positive surge with improved liquidity, demonstrating positive investor’s sentiment. Despite the FED rates hike is an adverse factor to the long-term wellbeing of the market and the reduction in value of ROS as a market driver, the VN-Index still experienced a gain thanks to the agreement of most of the Blue-chips as well as other small and medium size stocks. However, to date, there has been no significant news to boost the market out of the 720 resistance. Therefore, we believe the index will be more likely to move between 710 and 720. Especially, the movement of ROS should be carefully observed due to its significant impact to the index value. Investors should not follow general capital movement in this period, but focus on selecting fundamentally healthy stocks with good business performances, which are gradually published during this shareholder meeting season.