The VN-Index, which measures the stock market, increased at a rate of more than 10% in spite of economic challenges. Comparing this growth rate to the average of the last ten years, which was 9.3%, seems reasonable. Comparing various asset types' returns: Since the start of the year, the best-performing channels have been gold and stocks. Therefore, 2024 is still anticipated to be a comparatively strong year for stock investors despite modifications made since September.

Profit Influencing Factors

There will be a lot more favorable variables in 2024 for the Vietnamese stock market (TTCK). Internationally, current projections suggest that there will be a "soft landing" for the US economy, with average growth perhaps surpassing 1% and inflation ceasing to be a significant worry. This will also result in a reversal of FED policy in 2024, when three rate decreases totaling 0.75% are anticipated during the year.

In 2024, external factors will mitigate worries over Vietnam's inflation and currency rate fluctuations. As a result of the anticipated sharp decline in external headwinds and the implementation of the expanded fiscal and monetary measures that supported the economy in 2023, Vietnam's economic growth in 2024 is anticipated to rebound more forcefully. Vietnam's economy would rebound more forcefully in 2024 and resume high growth periods starting in 2025, according to IMF projections.

The profit outlook for listed companies (DNNY) is expected to improve with an overall market EPS growth rate of perhaps 15% in 2024, compared to the projected 8% decline in 2023. This growth rate is good when compared to other markets in the region, and it is due to the reversal of FED policy and the anticipated stronger recovery of Vietnam's economy. The main thing influencing the VN-Index will be this. Based on the aforementioned prediction, Mr. Phuong thinks the VN-Index may expand by more than 17% by the end of 2024, when it reaches the 1,300 point threshold (/-20 points).

The above-analyzed recovery of the Vietnamese economy and the prospects for US and worldwide economic development are factors that will have a significant impact on the stock market in 2024. It's also important to take note of the substantial quantity of corporate bonds that are due, the real estate market's revival, the launch of the new KRX trading system, and market improvements. In the event that these variables shift, market prospects and index potential may change in 2024.

Investment Strategy for 2024

The analyst projects a solid growth trajectory for the stock market until 2024, punctuated by several ups and downs. As a result, short-term investors shouldn't chase after significant rises in the index; instead, they should trade within a specific range. This is still a good time for long-term investors to accumulate assets, but because several stock groups have already had substantial price gains and there is already a sizable valuation gap between sectors, there should still be some diversity in the portfolio.

The initial 2024 priority sectors are those from industries like electrical construction, upstream oil and gas, and aquaculture that have shown remarkable profit growth.

The Eighth Electricity Plan, which was approved this year, has recognized the electrical construction industry as a critical infrastructure sector. Power development must take the lead in laying the groundwork for swift and sustainable national development, guaranteeing national security and defense, and ensuring energy security. The government is prioritizing investment and pushing economic sectors to expand the power industry fast. As a result, public investment packages for electrical construction are being disbursed swiftly. Thus, with stocks of interest like TV2, PC1, and CTR, this will be a big potential for businesses in the electrical construction and power sectors in the near future.

Oil and gas firms in the upstream sector would reap benefits in the medium term (2023-2025) with the formal launch of Lot B, the major gas project. Companies in the upstream sector, such as PVD and PVS, and those in the midstream sector, such as PVB, will be involved in the Lot B project bidding packages.

Positive signs have gradually returned to the pangasius industry in the aquaculture sector, and 2024 is expected to explode due to three factors: (1) the expected recovery in consumption demand in the US and China; (2) the US companies' cycle of inventory reduction ending, which will lead to a rebound in import demand the following year; and (3) a sharp decline in the supply of raw pangasius as people limit  new farming due to significant losses sustained over the previous year. We anticipate that as a result, businesses in the pangasius sector, such as ANV and VHC, will profit and see a breakthrough in EPS growth in the upcoming year.

In the medium run, it is also anticipated that the public investment and industrial real estate sectors will continue to prosper. The securities sector, on the other hand, is anticipated to see a market upgrade in 2024, so these are interesting sectors to watch.