The stock market indices are forecasted to have a high probability of continuing a slight recovery after the VN-Index reacted positively at the support zone of 1,255 points and macro factors are gradually easing psychological pressure on investors in the short term. Experts assess the next very strong resistance zone is the price zone of 1,300 points - the peak zone from March to July 2024 and September to October 2024.
Accordingly, since the beginning of April 2024, VN-Index has not been able to maintain the upward trend but has moved sideways, with 6 failures when testing the resistance zone of 1,300 points. In the context that the market is still under many impacts such as the existing exchange rate pressure, foreign investors have continuously sold Vietnamese stocks and this trend has not shown any signs of slowing down. Foreign investors have sold net for 19 out of the last 20 months and since the beginning of the year, they have sold net more than 85,000 billion VND.
Many experts believe that the stock market is still in a short-term accumulation phase, so cash flow will still be differentiated between stock groups and large- and medium-cap stocks may continue to accumulate within a narrow range in the coming trading sessions. In addition, the short-term sentiment indicator continues to increase, showing that investors are still optimistic about the current market developments.
MB Securities Joint Stock Company (MBS) has just released a report forecasting that the whole market's profit could record a remarkable growth of 25% over the same period in the fourth quarter of 2024, the highest since the second quarter of 2022, supported by a low interest rate environment and production on the path to recovery.
Notably, real estate industry profits are expected to grow strongly by 1,005% in the fourth quarter, partly due to the low base level of the same period, partly due to the ability to hand over large projects. Northern real estate enterprises such as VHM will be able to record high profits from handing over large projects while Southern real estate enterprises will record profits from handing over some prominent projects such as Privia (KDH), Akari (NLG), Gem Sky World (DXG). For the whole year of 2024, MBS forecasts that this industry's profits will increase by 5%.
For the leading stocks, MBS Research estimates that the after-tax profit of the monitored banks in Q4/2024 will grow by 14.5% YoY and 11.1% QoQ. Although the estimated credit growth of banks in Q4/2024 will be higher than in Q3/2024, NIM is expected to decrease slightly. Non-interest income is forecast to decline YoY as non-interest activities have yet to show signs of recovery in Q3/2024. Provision expenses are forecast to be higher than in the previous quarter and increase slightly by 1.4% YoY in Q4/2024 due to the high comparison base at the end of last year.
In terms of valuation, experts from Phu Hung Securities Company believe that Vietnam's current P/E for 2025 is below 10 times, which is 2 standard deviations lower than the average of the last 10 years. This P/E is also the lowest when compared to other stock markets in the Southeast Asian region. Therefore, this is the right time for investors to consider re-entering the Vietnamese stock market.
However, there are also challenges that investors need to pay attention to, such as escalating geopolitical tensions or the unpredictable policies of Donald Trump when he is re-elected as US President, which will affect not only trade but also other monetary and fiscal policies of Vietnam.
