Stock Market Weekly Forecast: What the US attacks on Iran mean for oil, gas and shipping stocks

The Vietnam stock market last week recorded an impressive increase right after the Tet holiday, with a breakthrough of 36 points in the opening session. Cash flow spread widely, but the leading sectors remained Vingroup, oil and gas, and banking.

Despite significant pressure from net selling by foreign investors in VNM and FPT, the VN-Index held firm at the 1,880-point support level for most of the time. Foreign investors net sold VND 5,191.5 billion in trading last week, an increase of over VND 7,243 billion compared to the same period before the Lunar New Year holiday.

The market opened in positive territory thanks to the pull from the Vingroup group, helping the VN-Index quickly extend its gains and approach the 1,900-point mark. However, increased profit-taking pressure in the banking sector and large-cap stocks such as VNM and MWG caused the index to narrow its gains, even falling below the reference level at times. The oil and gas and shipping sectors stood out with impressive surges from BSR (3.17%) and GMD (3.07%).

Entering the afternoon trading session of last week, the VN-Index continued to fluctuate within a narrow range, with slightly increased profit-taking pressure in the banking sector, causing the VN-Index to briefly fall below 1,870 points. In the last 30 minutes and during the ATC session, profit-taking pressure intensified in several large-cap stocks such as HPG, VCB, and BID, causing the VN-Index to fall to around 1,860 points.

However, the VN-Index quickly rebounded thanks to buying pressure from Vingroup stocks, helping the index close the week at around 1,880 points. Notably, foreign investors reversed to net buying today, with a total value exceeding VND 182.14 billion, focusing on FPT, GMD, and MWG.

At the close of last week's session, the VN-Index closed at 1,880.33 points, up 0.69 points, equivalent to 0.04%. For the week, the VN-Index increased by 56.24 points (3.08%) compared to the previous week.

The VN-Index closed with a Spinning Top candlestick, indicating pressure to test supply and demand as the market approached the resistance zone around the previous peak.

On the daily chart, the VN-Index fluctuated within a narrow range to test supply and demand around the 1,875–1,885 point range. The upward momentum of technical indicators showed signs of slowing down at high levels but has not completely reversed, so the immediate resistance zone for the index will be at the previous peak around 1,920 points, while the short-term support zone will be around 1,850–1,860 points.

On the hourly chart, the VN-Index is showing signs of volatility at the upper boundary of the Bollinger Bands. Simultaneously, the RSI indicator returned to the neutral level after entering the overbought zone, reflecting a short-term accumulation state. Therefore, it is necessary to note the possibility of continued volatility in the next session.

The VN-Index closed last week above 1,880 points, indicating continued efforts to maintain the index at a high level, although the upward momentum has slowed somewhat. Aside from a few stocks experiencing slight corrections after recording sharp gains compared to the overall index in the recent period, the majority of the market remains in an upward or sideways trend. Therefore, VCBS recommended that investors maintain holdings of stocks with stable upward momentum and without strong selling pressure and should select stocks that have successfully broken through resistance or tested convincing support levels with active buying volume to invest in for short-term trading.

Oil prices spiked sharply, possibly above $US100 a barrel, from $US75 on Monday for West Texas, given the disruption to oil supplies, including via the Strait of Hormuz due to the Iran-US and Israel conflict. The increase in oil prices will support oil and gas stocks as well as shipping stocks.

Mr. Tran Tuan Minh, CEO of TVI Financial Investment JSC, also predicted that Middle East geopolitical tensions will cause a sharp increase in oil, fertilizer, and gas prices because 20-30% of the supply of these commodities passes through the Strait of Hormuz. However, he believed that the actual benefit for domestic oil and gas companies from the increase in oil prices is not significant.

"GAS primarily handles gas transportation and distribution; PVS operates in the construction of oil and gas projects; and PVD provides drilling rig leasing services. BSR and PLX may benefit to some extent, but the degree is insignificant," Mr. Minh analyzed.

Mr. Tran Tuan Minh recommended investors need to be cautious about the sharp rise in stock prices. The safest strategy is to continue holding the portfolio or monitoring it, avoiding chasing prices at high levels due to the significant risks involved.

In the shipping sector, VSC and GMD also made a significant impact. GMD is demonstrating its leading role by setting a new peak since its listing. At 84,400 VND/share, GMD's market capitalization reached nearly VND 36,000 billion. Meanwhile, VSC signaled the end of its previous downtrend and opened up the possibility of returning to its previous peak. Given the high oil prices and ongoing Middle East geopolitical tensions, there is still room for this group to maintain its upward momentum.