SSI: Vietnam’s stock market may hit a short-term bottom in November
After two consecutive monthly declines in the VN-Index, SSI Research says lower valuations, seasonal patterns, and changes in interest and exchange rates could help the market form a short-term bottom in November. Thin trading, continued foreign net selling, and slower earnings growth remain constraints.
Vietnam’s stock market has yet to perform as expected following its upgrade by FTSE Russell. The VN-Index fell 3.5% in September and another 1.5% in October, closing at 1,741.6 points, 9.7% below its mid-May peak. Weaker trading, continued net selling by foreign investors, and relatively high interest rates have kept domestic investors cautious. SSI Research says the market may form a short-term bottom in November.
SSI Research notes that after two consecutive months of declines, the VN-Index trades at about 11.7 times projected 2026 earnings, or about 9 times excluding Vingroup. It also points to a seasonal pattern over the past four years: the index typically declined in September and October, bottomed in November, then rose by an average of about 19% to a peak in the first quarter of the following year. SSI Research stresses that the sample covers only four years and the pattern may not recur.
Macroeconomic conditions could also provide support. Bank deposit rates have fallen by about 0.5 to 0.7 percentage points, while the Vietnamese dong has appreciated by more than 2% against the US dollar since the start of the year. SSI Research says the exchange-rate change could give the State Bank of Vietnam more room to support market liquidity. It cautions, however, that trading remains thin, outstanding margin loans are high, and selling pressure from foreign investors persists.
An investor checks an electronic stock board at a securities company in Ho Chi Minh City.（VietVance）
Corporate earnings growth also risks slowing. Third-quarter net profit attributable to parent-company shareholders at firms listed on the Ho Chi Minh Stock Exchange rose more than 50% year on year, with Vingroup accounting for about 55% of the increase. Excluding the group, marketwide growth was 24%, below the roughly 30% recorded in the first half. SSI Research expects earnings growth may slow further in the fourth quarter, partly because of a high comparison base a year earlier.
Thiên Việt Securities (TVS) takes a more cautious view, cutting its year-end target price-to-earnings ratio for the VN-Index from 15 times to 11.5–12 times. It estimates that, at the end of October, only nearly 32% of stocks on the exchange traded above their 200-day moving average, and forecasts the index will reach 1,800–1,850 points by the end of the fourth quarter. SSI Research, meanwhile, advises investors to buy selectively during pullbacks and avoid chasing rising prices.
Source: VietVance
