Vietnam Insider

Ho Chi Minh City, June 18 – Vietnam’s benchmark VN-Index slipped into negative territory on Tuesday, snapping a strong two-day rally as investors locked in gains from banking and real estate stocks.

After climbing near a three-year high in the previous sessions, the VN-Index struggled to stay in the green throughout the day, oscillating around the reference level. The index ultimately closed just shy of 1,347 points, down by less than one point.

Analysts noted that the session reflected emerging short-term correction risks but emphasized that the overall upward trend remains intact. Market breadth, however, leaned bearish with 184 declining stocks far outnumbering 108 gainers.

Banking stocks led the market’s retreat, with six out of the ten stocks exerting the most negative pressure on the index belonging to the financial sector. Key decliners included VCB, VPB, BID, LPB, CTG, and EIB, each shedding between 1% and 1.7%. In contrast, STB and TCB offered some support, rising 2.6% and 1.2% respectively.

The real estate sector also saw widespread pullbacks, particularly among small-cap stocks such as SCR, KHG, QCG, and HDG—all down more than 1%. However, several mid- and large-cap stocks like VHH, NVL, and KDH managed to hold onto their gains.

The oil and gas sector showed signs of divergence after last week’s volatility. While PLX, POW, and PVT ended below their reference prices, GAS, OIL, PVD, and BSR stayed in the green despite growing selling pressure.

Notably, five stocks on the Ho Chi Minh Stock Exchange hit their daily upper limit without any sell orders by market close, including BCG and TCD—two stocks linked to Bamboo Capital Group.

Total market liquidity reached VND 20 trillion, about VND 700 billion lower than the previous session. No stock surpassed the VND 1 trillion trading mark. Steel giant HPG led trading activity with VND 850 billion in matched orders, followed by banking stocks MBB, SHB, STB, and TCB.

Foreign investors turned net sellers, offloading VND 272 billion after four consecutive sessions of net buying. They bought VND 2.068 trillion and sold VND 2.339 trillion, with selling pressure concentrated on STB, FPT, and HHS.

Market observers suggest that for the VN-Index to confirm a medium-term uptrend, it must convincingly break through the 1,350-point threshold with a surge in trading volume. While a new bullish wave may take time to materialize, the ongoing rotation of capital among key sectors—banking, real estate, and energy—is creating tactical opportunities for risk-tolerant investors.

Experts from Saigon – Hanoi Securities (SHS) advise investors to focus on valuations and second-quarter earnings results to guide investment decisions in the current environment.

Reported by Vietnam Insider News Desk

Experts say any potential market downturn would likely be short-lived, while oil and gas stocks may benefit in the near term.

As geopolitical tensions between Israel and Iran escalate, concerns are mounting over the potential impact on global financial markets, including Vietnam’s stock exchange. Yet, experts suggest the effects may be limited and short-term—particularly if the conflict remains contained within the region.

Geopolitical Tensions Aren’t the Only Market Driver

On June 17, Israel launched a large-scale airstrike on Iran, prompting an emergency national security meeting called by U.S. President Donald Trump. While dramatic, such developments may not have a lasting impact on stock markets, according to Nguyen Viet Duc, Head of Digital Sales at VPBank Securities (VPBankS).

Drawing from historical data, Duc noted that most geopolitical conflicts over the past 50 years have caused market volatility lasting only one or two sessions—unless they escalated significantly or involved direct U.S. military action.

“If the conflict remains regional, the primary impact would likely be seen in oil prices, not in global equity markets,” Duc said. In contrast, when the U.S. becomes directly involved, such as after the 9/11 attacks or the Gulf War in 1992, markets tend to see a deeper correction of 10–11%, with recoveries taking up to 70 days.

Currently, global markets seem to be pricing in a scenario where the conflict is contained within the Middle East and the U.S. stays on the sidelines. Oil prices remain around $70 per barrel—lower than the 2024 average. Duc added that as long as prices stay within the $70–$80 range, the overall impact should be manageable.

More notably, he emphasized that major downturns in stock markets tend to stem from macroeconomic factors, such as the 2008 global financial crisis or Vietnam’s 2022 bond market turmoil, rather than from armed conflicts.

Capital Flows and Market Sentiment

Analysts at Agriseco Securities echoed this view, pointing out that short-term risk aversion could lead to capital outflows—both direct and indirect—from financial markets located in or near the conflict zone.

Heightened geopolitical risks may also lead global investors to be more cautious with high-risk assets. If the conflict disrupts global supply chains and drives up energy prices, inflation could rise, potentially delaying interest rate cuts from major central banks like the U.S. Federal Reserve or the European Central Bank. Such developments could trigger negative reactions in global markets, indirectly affecting Vietnam’s bourse.

Still, historical data shows that both the Dow Jones and Vietnam’s VN-Index have typically rebounded within 10–20 sessions following geopolitical shocks.

Oil and Gas Stocks Surge Amid Conflict

From late last week into early this week, oil and gas stocks on the HoSE and HNX exchanges have seen a flurry of activity. Some tickers even hit the daily ceiling two sessions in a row.

According to Duc, the rally in energy stocks was anticipated. “Even before the conflict began, we had identified oil and gas as an attractive sector based on solid earnings, low valuations, and strong cash flow. This momentum only accelerated once geopolitical risks surfaced.”

Agriseco forecasts that the stock market may experience short-term declines due to rising concerns over the conflict’s escalation. However, markets are expected to stabilize and resume their upward trend shortly thereafter. The initial drop, they suggest, could present a buying opportunity for long-term investors targeting fundamentally strong companies with growth potential.

Why Vietnam’s Market May Remain Resilient

Vietnam’s stock market is relatively insulated from the Israel-Iran conflict. Trade and investment ties with the Middle East remain minimal, and there is virtually no direct exposure to either Israel or Iran.

Moreover, in a world increasingly wary of geopolitical instability, Vietnam’s reputation for political stability may position it as a safe haven for investors and global manufacturers looking to diversify supply chains away from high-risk regions.