We maintain our view on VN Index as at the beginning of the year. Accordingly, we expect the main trend of the market, in the base scenario, to be sideways for most of the first half of the year due to the lack of supportive motivations, while no significant risks. Therefore, the fact that VN Index has increased by 10.3% in January will limit the room for a further rally in February. In fact, the strong drop at the beginning of the month with high liquidity signals a pause to the short-term recovering trend. Additionally, we believe that the market needs some corrections to attract cash flow amid lacking new fundamental changes. In the base scenario, we expect the VN Index to fluctuate between 1010-1100.

In fact, the Fed's move to raise interest rates came in line with market expectations and did not make much of a difference to market sentiment. Similarly, the exchange rates and interest rates mainly sideways. In the coming months, we do not expect the Fed to revise its rate hike plan since the US economy is showing more stronger signals than previously expected. This development may also correct the market's expectation about the rate of decrease of inflation in the coming months.

Meanwhile, Q4-2022 business results fell short of market expectations. According to statistics of 370 HOSE-listing enterprises, the general trend in most industries is that growth started to decelerate with total revenue (or Total Operating Income for banks) inching up 7% YoY, while NPAT-MI dropping by 27% YoY. As a result, accumulative 2022 revenue and NPAT growth were pulled back to 17% YoY and 6% YoY, respectively.

Negative earnings growth in the latest quarter, coupled with the rally in January, pushed VN-Index's P/E valuation to 14.0x, the highest level since the end of Q3 last year, while there are still no positive surprises in fundamentals.

While the market is still waiting for new tailwinds from fundamentals, the quiet period is near until April, when the AGM and Q1-2023 earnings searsons start. This points to a higher likelihood of market correction in February. While prudent buying strategy with limited use of leverage is recommended, timing for short-term trading opportunities, in unexpected market weaknesses, is also viable. Accordingly, GMD, FPT, and QNS are the stocks that we think suitable for short-term timing.