Market Update [May 10] – VN-Index closes higher regardless of US-China trade tension

10/05/2019 16:33

Report: Market Update

On Friday (May 10th), regardless of the US-China trade tension, the VN-Index traded on a positive note, and closed at its highs of the day. Particularly, VHM, BID, GAS, SAB and TCB were the large-cap gainers, offsetting the relative weakness in VHM, MSN, MBB, HPG and VJC. By the closing bell, the VN-Index rose 5.54 points (+0.58%) to close at 952.55. Trading volume was over 130 million shares, worth VND2,900 billion. Breadth was positive, with gainers topping losers 181 to 102. Foreign investors net sold VND220 billion on the HSX, mainly in VHM.

In view of technical analysis, the VN-Index’s daily chart shows a short green candlestick at the support range of 940 – 950, while the RSI moves up to 40 – 50 range, which are the signs of positivity. Therefore, we believe that, in a positive scenario, the VN-Index will test the nearest resistance range of 960 – 970, at which investors can sell a part of the existing short-term portfolio. In a negative scenario, the nearest support range of VN-Index is forecast at 940 – 950, the next support range is expected at 920 – 930.

We recommend investors to be cautious in this period, and wait for more information from US-China trade negotiations. Technical recovery sessions next week are considered opportunities to reduce stock proportion. Based on Kelly formula, the recommended proportion of the portfolio is 90% cash/ 10% stocks.

Please see the attached file for more details.