Market Update [June 21] – VN-Index ends nearly flat on ETF rebalancing day

21/06/2019 16:05

Report: Market Update
Source: ASEANSC
ASEANSC’S VIEWPOINTS

On Friday (June 21st), although rising over 5 points at one point, however, the VN-Index closed nearly flat due to the rebalancing activities of VNM ETF and FTSE Vietnam ETF in ATC session. Particularly, VNM, GAS, SAB, MSN and CTG were the large-cap gainers, offsetting the relative weakness in VIC, VCB, VRE, BVH, NVL and HVN. By the closing bell, the VN-Index inched up 0.02 points (+0.00%) to close at 959.20. Trading volume was nearly 210 million shares, worth VND5,400 billion. Breadth was negative, with losers topping gainers 146 to 131. Foreign investors net sold VND352 billion on the HSX, mainly in STB.

In view of technical analysis, the VN-Index’s daily chart shows a red candlestick called “Shooting star” at the resistance range of 960 – 970, which is a sign of negativity. Therefore, we believe that, in a negative scenario, the VN-Index will test the nearest support level of 957, or MA20, the next support level is forecast at 956. In a positive scenario, if the index rebounds, the nearest resistance range of VN-Index will be forecast at 960 – 970, at which investors can sell a part of the existing short-term portfolio.

We recommend investors to observe carefully the support levels of 957 and 956, at which investors can buy a part of the short-term portfolio, and consider cutting loss if these levels are broken. Based on Kelly formula, the recommended proportion of the portfolio is 70% cash/ 30% stocks.

Please see the attached file for more details.