It is expected that Vietnam’s stock market is likely to experience good growth in 2022, especially when there are more economic recovery support packages. However, experts say that the market will also become more "sensitive" and it will not be as easy for investors to earn profit as before.
Lots of expectations…
According to SSI Securities Company, the goal of the upcoming support packages is to support many economic sectors, but it is not as extensive as before. However, the recovery package also brought excitement to investors in the stock market.
Similarly, Bao Viet Securities Company (BVSC) believes that many new policies in the first half of 2022 will be activated, which will create expectations to help the market grow rapidly. Accordingly, economic stimulus programs including public investment, tax support packages, interest rate support can create a boost from credit growth.
In 2021, Vietnam's stock market has grown strongly. The VN-Index increased by 35.73%, the HNX-Index recorded an increase of 133%, pushing the market capitalization up to 44.3%. According to Mr. Matthew, Head of Institutional Research, Yuanta Securities Vietnam, Vietnam stock market was the most attractive market in the world in 2021.
With the record-high figures for scores and liquidity, it seems that this year's stock market "party" is not over, at least in the short term.
In fact, many securities companies agree that the VN-Index will continue to gain momentum in the context that the economic growth rate may recover at 6-6.5%, although the margin will not be as large as in 2021.
Besides the economic recovery package, the stock market also expects many other factors including the implementation of a new information technology system on the stock market, the possibility of market upgrading, the divestment of state capital, the return of economic growth from a low base, the cash flow of individual investors in the stock market, and policies to promote private investment.
… but many difficulties
However, 2022 will no longer be an easy year for Vietnam’s stock market although the general opinion is still positive. Accordingly, the market may move cautiously in the first half of the year, influenced by concerns about high inflation, rising interest rates, weak domestic consumption, and low profit growth.
Therefore, more expectations are put in the second half of 2022 when all prospects become clearer, regarding the pandemic control mechanism as well as the above risks.
On the other hand, experts also think that in 2022, stock group differentiation will be more obvious. Accordingly, the cash flow is gradually shifting to the basic stocks with good and safe business results. Some securities companies also believe that stocks with hot gains but without fundamental value may enter a long correction cycle.
According to Rong Viet Securities Company (VDSC), the market may be more "sensitive" and volatile to negative information, especially when stock valuations have risen to a much higher level than that of the pre-pandemic period.
Accordingly, negative information includes unknowns about inflation, risks of the Covid-19 epidemic and global geopolitical fluctuations, and the trend of narrowing monetary policy in the world.
Another challenge is that the increase in stock supply may affect the absorption capacity of the market, leading to slower growth of the index. In the negative scenario, the market will face greater pressure if the F0 investor force is not as strong as in 2021.