Vietnam market sped up the rally by closing, up 1.8% and 0.9%, respectively.
• Real estate spurred the hike with PDR (+7%) surged to ceiling price. KDH at one point in the morning session also hit ceiling limit (+5.4%). DXG (+5.8%), VHM (+3.5%), VIC (+0.7%), and NVL (+0.9%) followed the uptrend.
• MSN (+7%) reached ceiling price as well thanks to strong foreign net bought. DBC (+1.8%) and SAB (+0.5%) inched higher while VNM (-0.8%) slid.
• Majority of the banking sector recovered into green, leading by SHB (+3.88%), STB (+3.62%) and EIB (+3.44%). • Oil&gas traded mix. Gainers were GAS (+1.4%) and PVT (+1.2%) whereas laggers remained PLX (-0.6%), OIL (-2.1%), PVS (-0.4%) and BSR (-1.2%). • Retails rose among PNJ (+3.4%) and MWG (+2.5%).
• Broker houses climbed up on SSI (+2.4%), HCM (+2.7%), VCI (+0.2%) and VND (+0.8%). Just recently, HCM planned to follow VND’s footstep switching to HNX soon.
• Traded liquidity eased to USD1bn (-13.6%).
• Foreign investors’ net selling spree continued to -USD32.7mn, topped by VNM (-USD11.4mn), VHM (-USD6.3mn), MBB (- USD3.7mn) and HPG (-USD3.5mn).
• Derivatives started off Monday quite positive with all basis gaps closed above the underlying index. Liquidity posted at 186,794 contracts, worth 1.04bn. OI at 31,872 contracts.
Over the weekend, the new Prime Minister held a special meeting with the central bank. Again, all eyes are on any discussion that could inform future monetary policy direction.
Here is our quick summary about vietnam stock exchange:
The central bank has wielded an effective tool to control the dispersal of credit into sensitive sectors and actual implementation, and has been there for years (like the ratio of short-term deposits over medium and long term loans – set at 40% at the moment).
For the property market, there might not be tightening (as banks are not behind the recent rally in the property price). Instead, it might just be monitored, as growth levels is similar to headline credit growth. For securities lending, it’s just too small (0.48% of total outstanding loans), so maybe it’s not worth discussing.
However, a number of issues have been raised by the SBV governor, such as i) balancing between monetary and capital markets ii) small and medium sized enterprise support iii) state-owned bank recapitalization iv) resolution for zombie banks (zero-VND banks, like Ocean bank, Construction bank, and GP Bank) and v) framework for fintech, with things like p2p lending, cryptocurrency, etc.
There might not be a big different in guidelines for the central bank, except for the fact that the PM requests the central bank to review the current issues, set priorities, and focus selectively on what can be done in the next 3 or 6 months, taking a step-by-step approach.
For charts of the day, when looking for a clear reading of Covid-19 related impact in the data, we find again that the only piece of data that can show this is through examination of the labor market.
The Q2 2021 results of the HOSE Indexes review have been announced, which is well in line with our forecasts. Please keep in mind that the new indexes will take effect since May 4th, and all related ETFs should finish rebalancing by Apr 29th .
For VNDiamond Index, KDH will be removed from the index, while ACB, EIB, LPB, MSB, TCM and VIB will be the newest additions to the index. LPB is the only surprise for us, as its FOL level nearly reached the required threshold according to our calculations.
As such, the new index basket will be composed of 18 stocks, including 10 banking stocks. The 40% cap rule will be applied for this sector, and therefore current banking constituents presence in the index will be reduced for new stocks to weigh in. MWG and FPT remain the two largest stocks, each with a 15% weight.
For the VN30 Index, all of its constituents will remain in this review. According to our calculation, VNM and CTG will be among the top buy list, while most other stocks might be partly disposed of by ETFs for rebalancing purposes.
Currently, there are 3 ETFs tracking the index, including the VFM VN30 ETF, SSIAM VN30 ETF, and Mirae Assets VN30 ETF, with a total AUM estimated at VND 8.9 tn. Detailed estimates for the rebalancing are as follows.