Profit-taking caused a sell-off after the index surpassed 780, but large-caps and banks helped the market recover for a modest monthly gain. June’s rally extended to the first week of July with the VN-Index breaching 780 to reach a nine-year high. However, profit-taking in the face of a technical resistance level took 16 points or 2.1% off the index in just two trading sessions (July 6 and 10). SBV rate cuts restored positive sentiment for a few days, but it did not last and the pullback
Vietnam equities had a great H1 2017. The VN-Index rose 16.8% on strong trading volume of USD145 million per day USD195 million including HNX and UPCoM) with USD438 million of foreign money entering the market (including HNX and UPCoM). This strong performance was driven by a combination of global and domestic factors, outlined below. Vietnam will continue to benefit as emerging markets are now back in vogue.
The VN-Index became the regional leader in terms of YTD market growth. The VN-Index rose 5.2% MoM and is up 16.8% YTD. After having corrected in the second half of April, it regained momentum to reach 776.47 on June 30, its highest level since February 2008. All sectors except for industrials had strong gains in June.
Investors in Vietnam ignored the old adage “sell in May and go away” as average daily trading volume surged to a record high of nearly USD260 million, far above the USD145 million seen in the Philippines. Positive macro-economic news, low YTD inflation of 0.37%, TPP-11 moving ahead, the visit of Vietnam’s Prime Minister to the US and improved outlooks from Moody’s and Fitch helped bolster market sentiment. Margin lending levels moved close to limits.
After steadily rallying from the beginning of 2017, the VN-Index corrected in the second half of April. Continuing the upward momentum from the beginning of 2017, the VNI rose to a fresh nine-year high on April 11 at 731.3 before falling to around 710. It then moved sideways for the next two weeks before slightly recovering in the last three trading sessions of the month. The rebound could be attributed to positive global and domestic news, including the US good initial Q1 results
Despite an interest rate hike by the US Fed, Vietnam stocks continued to rise, reaching a new nine-year high; VN30 reached its highest level ever as large-cap stocks increased. During the first half of March, real estate and industrial stocks, such as NVL, ROS, HBC and CII, drove market gains (+10 points to 717). However, when NVL and ROS were added to the MVIS Vietnam Index and FTSE Vietnam Index, respectively,
Vietnam’s equity market continued its steady move higher since mid-December and achieved a new nine-year high. The VN-Index started the Year of the Rooster on February 2 by closing above 700 for the first time since February 2008. Weak Q4 results of BHN, the third largest consumer ticker, disappointed investors and sent the index to its lowest level of the month, 700.04, on February 6.
The VN-Index enjoys solid gains in January and ended the month at a nine-year high. Vietnam’s equity market closed out the lunar Year of the Monkey at 697.28 on January 25, its highest level since February 2008 and up 4.9% from the end of 2016.
A quiet holiday season restrained market growth. The VN-Index ended 2016 at 664.72, falling 0.03% from end-November. This continued a downward trend from November, but with a smaller decline. Declining momentum started from the third week of November and ran through the first half of December as the index dropped to 651.49 on December 6, a two and a half month low, as foreign investors stepped up selling of large-cap names.
High foreign investment continued to drive Vietnam’s strong export growth and rising consumer strength in 2016. In spite of political uncertainties in the US, we believe that its economic strength will help to support Vietnam in 2017. The VN-Index was swayed by global trends throughout 2016, but finished with solid gains. 2017 may present some challenges if the US dollar continues to strengthen but macro stability should continue to support earnings growth. The real story,