Daily Market Watch 01/08/2025: VN-Index Ends Below 1,500 Amid Rising Profit-Taking and Foreign Selling

MARKET HIGHLIGHTS

o       The market opened cautiously, fluctuating around the 1,500-point level on low liquidity, reflecting investor indecision. While some investors expected the rally to continue, particularly after the Ministry of Finance’s proposal to impose a 20% capital gains tax on securities and property investments was rejected, others remained cautious. Positive catalysts included an encouraging July PMI reading, solid Q2 earnings results, and the U.S. government's announcement of new tariffs on various countries. However, concerns lingered that the market may still be in a consolidation phase after a strong rally since April. Elevated foreign selling also added pressure, weighing on sentiment and prices.   

o       In the afternoon, selling intensified, especially in the broader market, although select mid-cap names still posted gains. A modest recovery occurred near the close, led by large-cap stocks such as FPT, SHB, HDB, and VRE. The VN-Index closed at 1,495 points (-0.49% DoD, -3.02% WoW), slipping below the key 1,500-point mark. ETF rebalancing activities caused some volatility in the final session, but their impact on stock prices was limited. This marked the first notable weekly decline after 16 consecutive weeks of gains.

o       The U.S. announced new tariffs on multiple countries, with key Southeast Asian manufacturing rivals, Thailand, Cambodia, Malaysia, Indonesia, and the Philippines, facing 19% duties. Korea and Japan were assigned a 15% rate, while Vietnam received a 20% tariff. Though not the lowest, Vietnam's tariff maintains its relative advantage over direct competitors, supporting the country's ongoing competitiveness in export markets.

o       Vietnam’s manufacturing PMI rose to 52.4 in July, up from 48.9 in June, signaling renewed business confidence following the early-July announcement of a reduced flat tariff rate. In a further supportive move, the State Bank of Vietnam expanded credit growth quotas for several commercial banks, reinforcing the government's focus on stimulating domestic economic drivers.

o       Regarding performance, VN30 outperformed, falling only -0.1% thanks to strength in FPT, SHB, and HDB. Mid-cap stocks underperformed with a -0.9% decline, led by profit-taking in previously high-flying names. Retail investors actively locked in gains after several strong weeks of performance, especially in high-beta stocks

o       Market liquidity fell slightly to USD 1.5 billion, reflecting ongoing caution. Foreign investors recorded a significant net sell of USD 94 million on HoSE, with USD 69 million concentrated in VN30 stocks. Major net sold stocks included. Major net sold stocks included SSI (-USD 18 mn), CTG (-USD 14.9 mn), and FPT (-USD 11 mn). On the buying side, SHB (+USD 5.8 mn), NVL (+USD 3.3 mn), and MSB (+USD 3.2 mn).