20160617_BSC_Vietnam Daily Review_EN_Tumble at the end

Highlight

Global market is in risk aversion sentiment so that foreign investors are expected to gradually reduce their proportion in frontier markets like Vietnam. This week, foreigners' net-buying has slowed down and gradually shifted to net selling but without significant value. Today is the last trading day of 2 ETFs’ rebalancing period so the emergence of a strong net-selling from foreign investors and an increase in liquidity were expected. However, most of selling orders were in ATC session, which led most BCs to be short of demands and to fall sharply. The impact spreaded to speculative stocks which often go against the market so red was dominant on the floor. Similarly, the HNX-Index and Index Upcom was also declined along with the HOSE.

Recommendation

As we expected before today session, the market suffered quite a decline, trading volume rose significantly in ATC due to portfolio reallocation activities from ETFs. Some stocks under strong selling pressure while there was not sufficient demand in ATC, such as VIC, VCB, HHS, NT2, HPG, tumbled. In contrast, some stocks enjoyed strong demand from foreign investors such as MSN, GTN soared in ATC. VN-Index may rebound in the next session when it won’t be influenced by portfolio reallocation activities from ETFs. Current support and resistance zone of VN-Index locate at 618-616 and 625-630. Stocks declinded remarkably today due to selling pressure could be short-term trading opportunities for investors prefer high risk, moreover, as VN-Index technical signals are not improved, risk-averse investors are recommended to keep low stock weights.