The US Federal Reserve (Fed) yesterday announced raising the benchmark interest rate by 25 basis points, marking the first increase since 2023. As interest rates rise, the stock market becomes less attractive than safe and fixed-income investment channels such as bonds and deposits.
However, according to many experts, the impact of this event on Vietnamese stocks is relatively low, because the market has prepared psychologically for this scenario in advance.
Statistics from Yuanta Securities Company show that in the three periods when the Fed started to raise interest rates again since 2005, VN-Index often faced pressure before the decision was announced. The rest after the Fed raised interest rates, VN-Index did not decrease significantly. The market depends more on domestic factors, especially interest rates and exchange rates.
This is also a noteworthy variable for the market at the present time. The strong DXY index may increase pressure on emerging currencies, while the higher international interest rate level increases the relative attractiveness of USD assets. USD/VND is currently at 25,986 VND/USD, up 1.2% compared to the beginning of the quarter and the beginning of the year.
Dr. Nguyen Duy Phuong, Senior Director of Financial Analysis Division of DG Capital, said that the Fed's decision makes the State Bank's goal of lowering interest rates more difficult, thereby creating more pressure for economic growth ambitions of at least 10%. This is a macro-risk that investors need to proactively observe and closely monitor in the coming quarters.
However, Dr. Nguyen Duy Phuong emphasized that the valuation of Vietnamese stocks is relatively cheap and not commensurate with economic growth from the beginning of the year, thereby opening up long-term accumulation opportunities. In a market period with many risks and variables like today, investors need to be patient and have a long-term vision, instead of short-term surfing.
Yuanta Securities Company believes that short-term investors should maintain caution, monitor market reactions after the Fed's decision, especially exchange rate and interest rate movements in the country.
This securities company offers a reference ratio of 40% for stocks and 60% for cash, waiting for the market to reflect new factors and the valuation level to become more attractive. If the domestic exchange rate and interest rates do not show negative changes in the coming sessions, investors may consider gradually increasing the stock ratio.
Instead of widespread cash flow, differentiation between industry groups may continue to be a prominent feature. Some groups that Yuanta noted include oil and gas, rubber, fertilizers and medium-to-large capitalization stocks with relatively good price strength. Among them, commodity price-related groups are also receiving attention as Brent oil is still in the range above 100 USD/barrel and rubber prices are showing positive developments.
Regarding the movement trend of VN-Index, the 1,800 point zone is becoming an important test mark in the short term, while 1,820 points is a resistance zone that needs to be overcome to consolidate the trend. In the context of low liquidity, the developments of foreign capital flows, exchange rates and domestic interest rates will be factors worth monitoring to assess the market's ability to form a new balanced level after the Fed's policy decision.
Notably, at the same time as the Fed issued the interest rate decision, Vietnamese stocks also had a more noteworthy event, which was the upgrade from the frontier market to the emerging market from September 21. Before the upgrade date, the first disbursement of index simulation funds is expected to take place today.
SSI Research estimates that in this disbursement alone, funds modeled after Vanguard's FTSE Global Equity Index Series are expected to net buy about 240 million USD for 27 Vietnamese stocks.
