Straight from the horse’s mouth: says leading economic experts’ online seminar

Hoang Cong Tuan, senior analyst, Military Bank Securities Company

In my opinion, the Vietnamese stock market still holds the potential to grow well in the coming fourth quarter due to the positive macro-economic prospects and businesses’ profit.

Vietnam’s macro-economy is showing positive signs with the estimated growth rate around 6.4 per cent – 6.5 per cent and low inflation rates this year. Regarding the foreign exchange rate, despite the fact that the dong has been devalued by 5 per cent against the US dollar since the beginning of the year, the decrease is still much lower than other regional currencies. Besides, the stabilised interest rates will support businesses’ profit plans.

The profit is estimated to be 13 – 15 per cent higher than the previous year, according to our analyses. Also, Vietnam’s tickers are currently valued much lower than other markets in the region, as mirrored by the Price-to-Earnings Ratio (P/E), which is at a low of 10.8, in comparison with Thailand’s 17, the Phillippines’ 19 and Indonesia’s 23.

That is to say, investors should have long-term vision, instead of being led astray by short-term ups and downs. In particular, investment plans should focus on codes with good business results, or codes enjoying lingers from the foreign ownership cap removal policy and the oil price plunge.

Bui Quoc Dung, general director of the Monetary Policy Department under the State Bank of Vietnam.

Anticipating these global movements, the SBV has adjusted both the inter-bank rate and the trading band to eliminate negative effects on the Vietnamese market, which, in my view, is enough to counter the volatilities even in early 2016.

After that, the SBV chose to sell some of its US dollar reserves, among other moves, to stabilisethe forex and foreign currency markets.

Regarding further volatilities in the time to come, SBV will continue selling its foreign reserves if needed, in addition to implementing other policies and adjusting regulations on inter-bank interest rates or on foreign currency transactions. These target lifting market liquidity, reducing pressure from both the demand and the supply side of the market”.

Nguyen Xuan Binh, deputy head of Research at Bao Viet Securities Company

Currently, fluctuations in the Chinese stock market have the largest impact on markets all over the world, including Vietnam. The Shanghai Composite crash will take its toll on the world’s second largest economy by reducing the aggregate demand, hence affecting global production and economic growth.

The FED’s intention to raise interest rates has been reflected in the market behaviour since the end of 2013. Firstly, macro-economic policy adjustments have taken into account the possibility of a lift, with the forex rate policy as an example. Secondly, most of the investment funds by far have come up with portfolio restructuring methods/alternatives to avoid risks.

In conclusion, such a move by the FED with raising margin equal to or less than 0.5 per cent would not pose a significant impact on the Vietnamese stock market”.