Speaking on the Financial Street talk show, Tran Anh Tuan, director of PetroVietnam Securities's (PSI) analysis center, said Vietnam’s macroeconomic environment remained relatively stable in the first months of the year despite global uncertainties.

Tran Anh Tuan, director of PetroVietnam Securities's analysis center. Photo courtesy of the Financial Street talk show.

Vietnam’s first-quarter GDP expanded 7.83%, the highest level in nearly a decade. However, inflationary pressure has intensified as rising global fuel prices linked to geopolitical tensions pushed up imported inflation risks. Average consumer price index (CPI) in the first four months rose about 4%, while public investment disbursement remained below planned levels.

At the same time, Vietnam’s trade balance returned to a deficit of nearly $7.5 billion due to surging imports of machinery and raw materials for production. Still, positive foreign direct investment disbursement of around $7.4 billion in the first four months helped stabilize the exchange rate and support the broader economy.

Market volatility driven by large-cap stocks

Vietnam’s benchmark VN-Index experienced sharp swings in H1 of the year. The index climbed above 1,900 points in January 2026 before falling to around 1,600 points amid geopolitical tensions in the Middle East, then recovering during Q2.

According to Tuan, the market’s recent gains were concentrated mainly in large-cap stocks, particularly companies linked to Vingroup, while most other stocks remained range-bound. He described the trend as a “K-shaped” market divergence.

Market liquidity improved during Q1 but weakened again from April as deposit interest rates edged higher, prompting investors to shift funds toward safe-haven assets such as bank deposits, gold and the U.S. dollar. Foreign investors also maintained strong net selling in the early months of the year.

FTSE upgrade seen as key catalyst

Despite those challenges, analysts remain optimistic about the outlook for the final two quarters of 2026.

Tuan said that from late Q2 or early Q3 onward, as macroeconomic conditions stabilize and expectations surrounding a market upgrade become more fully reflected in stock prices, capital flows could broaden beyond a small group of sectors.

“The outlook for Vietnam’s stock market remains positive, with the biggest catalyst coming from FTSE Russell’s market upgrade roadmap in September 2026,” Tuan said.

“If Vietnam is upgraded to emerging market status, the market could attract between $1.5 billion and $1.7 billion in passive ETF inflows,” he added.

He also noted that valuations remained attractive. Excluding Vingroup-related stocks, the market’s price-to-earnings ratio stood at around 12 times, significantly below the five-year average of approximately 16 times.

Against that backdrop, Tuan said investors should use market pullbacks to accumulate fundamentally strong stocks positioned to benefit from Vietnam’s economic growth.

Banks, brokers, energy among favored sectors

Tuan identified banking, securities brokerage, public investment-related companies, oil and gas, and fertilizer producers as sectors with strong potential in H2 of the year.

Banks are expected to remain a key pillar supporting economic growth as credit expansion, while slowing in percentage terms, continues to increase in absolute scale compared with 2025.

Brokerage firms could be among the largest beneficiaries if FTSE Russell upgrades Vietnam to emerging market status in September 2026. Passive ETF inflows are projected to reach as much as $1.7 billion, while average daily trading value in Q1/2026 already increased nearly 20% compared with the 2025 average.

Companies linked to public investment are also expected to benefit as the government continues to push fiscal stimulus measures to support economic growth.

Meanwhile, oil and gas and fertilizer companies are seen gaining from higher global commodity prices and rising demand amid ongoing geopolitical instability.

Tuan said market performance would likely remain highly selective, urging investors to focus on periods of correction to build positions.

“Most stocks on the market are currently trading at attractive valuations, except for some groups that have already risen strongly,” he said.

“This is a good opportunity to deploy capital ahead of catalysts such as Q2 and Q3 earnings results, Vietnam’s potential market upgrade and improving macroeconomic conditions.”