VN-Index Faces a Dual Challenge

The stock market in April is seen as being influenced by both cyclical patterns and rising geopolitical tensions. This combination may push investors toward a broadly defensive stance, especially as the market moves past the first-quarter earnings season and enters a period with limited supportive information.

The VN-Index gained nearly 12% in August with record liquidity. Many open-ended funds on Fmarket also posted strong outperformance, highlighting the role of institutional capital during bullish phases.

Looking ahead, the VN-Index in April 2026 is expected to remain caught between recovery expectations and external pressures.

According to Vu Duy Khanh, an analyst at Smart Invest, historical data shows that April tends to be relatively balanced, with nearly equal probabilities of gains or declines. However, this statistical neutrality does not fully capture current realities. The market has experienced four consecutive years of decline from 2022 to 2025—an unusually prolonged downturn—which has significantly weakened investor sentiment. This accumulated caution acts as an invisible barrier, discouraging new capital inflows and amplifying the market’s sensitivity to external shocks.

Historically, April has often been a period of vulnerability, particularly when positive information has already been priced in. In 2018, the VN-Index dropped 27% from its peak due to overvaluation. In 2022, it fell from 1,500 to 900 points amid a bond market liquidity crisis and declining confidence. In 2025, U.S. tax policies reversed export growth expectations.

These examples suggest that April is not necessarily a “neutral” period in practice, especially when investor sentiment is already fragile.

From a behavioral perspective, Vietnam’s April 30 holiday has gradually become associated with a “defensive pattern” in the market. After positive signals from annual shareholder meetings are priced in, the market often enters a phase of limited new information. Buying momentum weakens, capital becomes more cautious, and the index struggles to sustain upward momentum, often leading to consolidation or correction.

While historical and behavioral factors shape market psychology, 2026 also introduces an additional geopolitical variable that directly affects global cost structures. With oil prices hovering in the range of $100–112 per barrel, inflationary pressures are mounting across many economies. Past crises suggest that if oil prices exceed $138 per barrel for a sustained period, the risk of a global recession becomes more pronounced.

“From a technical perspective, the VN-Index is facing a key resistance zone of 1,700–1,750 points. The recent rebound, particularly the rally on March 27, is insufficient to confirm a sustainable uptrend due to a lack of supporting liquidity and key technical signals. This indicates that the market remains in a weak recovery phase, with potential downside risks,” the analyst noted.

In its latest report, Viet First Securities (VFS) suggests that if Vietnam receives positive news regarding FTSE market classification and foreign capital returns, the VN-Index could break above the MA200 and move toward the 1,750-point level. Conversely, in a more cautious scenario, escalating geopolitical tensions could push the index to retest the 1,520 level; a break below this threshold would confirm a longer-term downtrend.

Overall, the VN-Index in April 2026 is likely to remain in a tug-of-war between recovery expectations and external pressures. Whether key support levels hold will be critical in determining the market’s direction, requiring investors to remain cautious and flexible in portfolio allocation.

Prioritizing a “Slow Trading” Strategy

In this context, sectoral divergence is becoming more pronounced. According to Mr. Khanh, oil and chemical stocks face risks of earnings peaking, as expectations have largely been priced in, increasing the likelihood of “sell-on-news” behavior. In contrast, fertilizer companies stand out due to their advantage of domestic gas supply, especially amid global LNG disruptions.

Meanwhile, banking and real estate sectors may appear attractively valued but still carry the risk of “value traps” if system liquidity does not improve. Power companies, on the other hand, are emerging as defensive plays due to stable demand and resilience to cost fluctuations.

Vietnam’s potential market upgrade under FTSE standards, expected in early April, is seen as a positive long-term signal. However, expectations of a sudden surge in foreign capital inflows in the short term may be unrealistic, as such upgrades typically require time to be fully reflected in market dynamics.

In a highly volatile and uncertain environment, investment strategies should prioritize risk management and discipline. Maintaining a higher cash allocation and deploying capital gradually at strong support levels is considered appropriate. Investors are also advised to review portfolios carefully, reduce leverage, and focus on companies with solid financial foundations and lower exposure to input cost pressures.

“In a sideways market with wide fluctuations, the principle of ‘slow trading’ becomes especially important. Frequent portfolio rotation not only increases costs but also raises the likelihood of compounding mistakes. In practice, sustainable returns during such periods tend to favor patient investors with clear strategies and readiness for adverse scenarios,” Mr. Khanh emphasized.

In April, as external uncertainties persist, holding cash should not be viewed as passive defense. Rather, it is a necessary preparation to capture real opportunities when the market stabilizes after geopolitical shocks.