HANOI: Escalating geopolitical tensions between Russia and Ukraine would have a short-term impression on the Vietnamese inventory market, however the market nonetheless has optimistic development prospects in the long run due to secure macro components.
VN-Index closed final week, the ninth week of 2022, with three gaining periods, two lowering periods, shedding 5.95 factors, or 0.4%, closing at 1,498.89 factors.
Significantly on Feb 24, when the strain between Russia and Ukraine reached its peak, together with many different international inventory indices, the VN-Index misplaced greater than 17 factors, with many shares plummeting.
Bui Hoang Minh, senior analyst for particular person purchasers at Ho Chí Minh Metropolis Securities Corp, stated that geopolitical tensions usually had a short-term impression on the inventory market.
Concerning the impacts, the Russia-Ukraine pressure brought about vitality costs to rise, resulting in rising prices, leading to inflation in international locations all over the world. Nevertheless, rising vitality costs is a predictable drawback, Minh stated.
Based on Minh, if oil costs proceed to remain at US$80 to US$90 (RM336 to RM378) per barrel, vitality and fertiliser inventory teams will profit and put strain on the financial tightening coverage determination.
“Geopolitical tensions can be a serious concern within the first and second quarters, however when making funding choices, traders want to have a look at a market with long-term financial prospects within the subsequent two-to-three years, with benefitting industries reminiscent of actual property, industrial zones, oil exports and retail,” Minh stated.
Based on Nguyen Hoai Thu, managing director of VinaCapital’s Securities and Bond Funding Division, the obvious danger brought on by the current Ukraine concern is inflationary.
“On the availability facet, sanctions and provide chain disruptions can result in shortages of many fundamental commodities, which immediately will increase enter costs for companies.
“On the demand facet, inflation can decelerate consumption and funding disbursement within the financial system, together with public funding, as a result of excessive costs and unpredictable fluctuations,” Thu stated. — Viet Nam Information/ANN