VnDirect: Economy and stocks to recover in Q4

Vietnam’s economy as well as stocks in certain sectors are expected to begin to recover in the fourth quarter of 2021, according to a report from VnDirect.

Thanks to high demand for Vietnam’s exports, the reopening of some non-essential services will help the economy recover from the fourth quarter of 2021. Profits in industries such as oil and gas, real estate, retail, food and beverages, and banking will recover in the fourth quarter while those of the securities and steel industries will remain high.

Industries such as exports, oil and gas, and real estate are also forecast to recover strongly in 2022 and 2023, at 21 per cent and 18 per cent, respectively. The stock market will continue to be supported by cash flow from individual investors in the context of low deposit interest rates.

In particular, some industries are also forecast to see profits improve strongly in 2022, including goods and services, real estate, and oil and gas. Meanwhile, earnings per share (EPS) growth of companies listed on the Ho Chi Minh Stock Exchange (HoSE) is 26 per cent. The oil and gas sector will attract cash flow in October because the world oil price is likely to continue its uptrend in the fourth quarter due to the supply response being slower than the recovery of global demand, according to VnDirect.

In terms of the banking sector, investors expect that profits in the second half of the year would be affected by the fourth Covid-19 wave. However, it is expected to then be representative of the revival of Vietnam’s economy in 2022.