Business Results Expected to Improve in 2024, Boosting Confidence in the Stock Market

According to experts, overall, the Vietnamese stock market (TTCK) is still on an upward trend, similar to how businesses are gradually recovering. The stock market is entering its final trading sessions of 2023. What many investors are currently interested in is the economic outlook and investment opportunities in 2024. At the Finance Street Talkshow on VTV8, Mr. Le Quang Chung, Deputy General Director of Smart Invest Securities Joint Stock Company (AAS), shared his insights and forecasts on the market’s developments in the new year. BTV Mui Khanh Ly: The economy has grown positively in the first three quarters of 2023, and with about two weeks left until the end of 2023, how do you assess the economy in Q4 and for the entire year 2023? Mr. Le Quang Chung, Deputy General Director, Smart Invest Securities Joint Stock Company (AAS): According to our assessment, the economy in the first 11 months of 2023 recorded many positive changes. Production, domestic consumption, and exports continued to improve. The USD/VND exchange rate cooled down, increasing by only 2.95% (as of November 30, 2023), and deposit and lending interest rates continued to decrease in line with the Government’s orientation; in fact, deposit interest rates at some banks have fallen to a record low for many years. However, credit outstanding still increased slowly by 8.21% as of November 22, 2023. In addition, the corporate bond market continued to record positive changes, with the scale of new issuances maintaining relatively well compared to the early months of the year, and the extension of principal and interest payments to bondholders proceeded more smoothly. Meanwhile, the number of registered bond codes on HNX increased rapidly, which is a prerequisite for enhancing the liquidity and transparency of the bond market. However, large maturity pressure, limited liquidity, and the ability of some businesses to repay principal and interest, while Decree 08 is about to expire, are also issues of concern. The domestic economy continued to grow positively despite facing certain difficulties; however, the stock market, after a positive recovery in the first half of the year, adjusted downwards and mostly moved sideways, with unstable fluctuating liquidity in the recent period. According to you, why is that? The performance of the stock market (TTCK) depends on macroeconomic policies and business health. The period when the stock market surged with high liquidity was when there was a change in macroeconomic policy, and that price increase in the stock market triggered speculative capital flows. When prices rose to a high level, businesses’ operating results did not improve as expected, causing the market to correct and speculative capital flows to shrink. We believe this is a relatively normal phenomenon. Overall, the Vietnamese stock market is still on an upward trend, similar to how businesses are gradually recovering. Policies always have a lag of six months to a year to permeate the economy. We are in the initial stage of overcoming difficulties. With such prospects, it is clear that investors also need time to observe the results of addressing difficulties, and their caution is not surprising. However, overall this year, the stock market is still in an upward trend compared to last year, with stock price levels, especially for the Midcap group, trending higher than last year. So, according to you, what solutions are needed to continue boosting spending and consumption, creating momentum for the economy in 2024? Based on the policies that have been and are being implemented, I believe additional policies could include promoting public investment in the digital economy segment, especially in digital infrastructure, encouraging focus on 5G, the Internet of Things, smart computing centers, data centers, satellite Internet… For digital economy sectors, encouraging focus on data centers, industrial Internet, big data, data security, artificial intelligence… Strongly activating the capital market by increasing the supply of quality goods and expanding licensing for the establishment of fund management companies, institutional investors… as well as focusing on accelerating equitization and early listing, helping the capital market become more vibrant and sustainable… For the stock market, what will be the important factors to boost investor confidence and drive the market more positively in 2024? For the Vietnamese stock market, I think factors such as market upgrade solutions that we still hope for or strive to implement, and bringing the KRX system into operation, will help market liquidity continue to increase. Additionally, businesses’ efforts to improve their business operations will be factors boosting investor confidence in the stock market in 2024. In particular, we expect the business results of listed companies to improve in 2024, thus the stock market will be more positive next year. SOURCE: CAFEF