Vietinbank Securities has published the Weekly Investment Strategy Report on 2nd January, 2024 with the executive summary presented below:
- According to the data from the U.S. Department of Commerce, the core Personal Consumption Expenditures (PCE) index, excluding food and energy, increased by 0.1% compared to the previous month and rose by 3.2% compared to the same period last year. Previously, economic experts had forecasted figures of 0.1% and 3.3%, respectively. Regarding the inflation measurement index, the Federal Reserve prefers PCE over the Consumer Price Index (CPI) because PCE focuses more on what consumers actually spend, while CPI measures the cost of goods and services. The PCE report opens up expectations for the first interest rate cut to take place in March 2024.
- In the past week, the shift of foreign capital towards net buying in the late week significantly improved market sentiment. This became a crucial driving force that led to a substantial increase in liquidity and average transaction value per session compared to the previous week, reaching values of 702 million shares and 16,100 billion VND, respectively. As a result, the VN-Index became the world’s strongest performing index with a gain of 2.44%. In terms of sectors, there was a strong inflow of funds into the tourism and entertainment group (5.57%) and the communication sector (3.88%).
- With the economic and social indicators of Vietnam in 2023 being announced with many positive signals, and the deposit interest rates at banks continuing to decrease to record lows, it is forecasted that money will continue to flow strongly into the stock market. This is expected to help the VN-Index maintain its upward trend and approach the resistance level of 1,160 points in the week from January 2 to January 5, 2024. Investors are advised to increase the stock/cash ratio to 70/30
- If the VN-Index overcome the essential resistance level at 1.133 points with high volume, investors are recommented to increase the stock/cash ratio, with the expectation that the VN-Index will approach the next resistance level at 1.165 points.
- Some of the noteworthy stock groups at this time include:
- Potential stock portfolio:PNJ, GEX, DGW
- If the market accumulates stably the money flow can circulate strongly into some speculative industry groups, including:
- Securities: HCM, SHS
- Real estate: TCH, DIG
- Sea port: HAH
- Steel: HSG
