Macro & Market QI.2019_Many important factors, Unpredicatble development_20190401

Macroeconomics
• GDP of Q1 / 2018 increased by 6.79% YoY. Industry and construction sector has the strongest growth rate with 8.63% YoY.
• PMI in March 2019, rose to 51.9 from February's 51.2 and made this year average increase to 51.6 (2018 was 53.7).
• Total retail sales of consumer goods and services in the first quarter of 2019 were estimated at VND 1,184 trillion, an increase of 12% YoY.
• Total registered FDI in 3M2019 reached USD 5.12 billion (+ 30.9% YoY), but total disbursed FDI reached only VND 4.12 billion (+ 6.2% YoY). Manufacturing and processing sector and real estate sector are the two leading sectors in attracting FDI..
• The interbank USD exchange rate fluctuated in the range of 23,050 – 23,349 VND/USD.  In 1st quarter of 2019, the interbank interest rates at all periods decreased after Lunar New Year but recovered in the last week of March.

Stock Market
• HSX and HNX recovered slightly. VN-Index officially increased by 15.3 points compared to the end of last month (+ 1.58% MoM), (+ 9.88% YtD) and HNX-Index increased 1.58 points (+ 1.49% MoM), (+ 3.08% YtD).
• Average liquidity on 2 exchanges increased 7.31% compared to February 2019, and increased to VND 5,374 billion/session and equivalent to nearly USD 231.6 million/session.
• In March, foreign investors net bough VND 981 billion on the HSX, net bought VND 433 billion on the HNX.
• P/E of VN-Index increased to 16.54 + 1.57% MoM, + 10.25% YtD and HNX-Index recovered slightly to 8.67 respectively + 1.46% MoM, -0.39% YtD. Compared to February 2019, the P/E of VN-Index increased to the 8th position and HNX-Index continued to hold the 19th position in Asia.

Market Outlook in March
The movement of VN-Index is still positive, however, the motivation to rise above the psychological threshold of 1,000 points is not clear. Cyclical adjustment may take place in the second half of the season when the first quarter earnings report is finished. We forecast that VN-Index will continue to fluctuate, increase slightly in the first half of April and then adjust the second half of April to May. The recovery trend returns in late May and early June. The price movement area in the second quarter ranges from 950 - 1,050 points. In the second quarter, BSC offers two scenarios as follows:
• In a positive case, the VN-Index will hold 950 points at the correction and test 1,050 points in the second quarter. Movement trend still moves around large stocks with support of foreign capital.
• In a negative case, the VN-Index may fall below 950 points when the market corrects and meets with negative information from the world.

Recommended stocks:
• The industry group and stocks are evaluated positively in the Industry Prospects Report 2019;
• The group of Banking - Finance stocks had strong improvement in business results,Nhóm cổ phiếu hưởng lợi từ các hiệp định thương mại và chuyển dịch sản xuất từ chiến tranh thương mại;
• Stocks benefit from recovering raw material prices and oil prices;
• High defensive stocks such as Electricity, Information Technology - Post, Retail consumption have high growth and dividends;
• In the long term, BSC's recommended stocks will be mentioned in quarter IV sector strategic reports , stocks with good changes are recommended in the weekly Investment Advisory Report  and Industry business update report.