boiman
15-10-2008, 05:51 PM
A slowdown in global economic growth would have some
benefits for Vietnam that may contribute to a stock-market rally,
according to PXP Vietnam Asset Management Ltd.
The Ho Chi Minh City Stock Exchange’s VN-Index Tuesday
rebounded 17.66 points, or 4.75 percent, to close at 389.33. The
measure declined 16 percent last week, the biggest fall since a
five-day slide that ended on October 5, 2001.
The International Monetary Fund last week forecast
global economic growth will slow to 3 percent in 2009, from 3.9 percent
this year and 5 percent in 2007, as a result of ailing banks and a drop
in property values.
“A global slowdown should act to moderate the
difficulties – high inflation and a widening trade deficit – that got
Vietnam here in the first place,” wrote Kevin Snowball, Ho Chi Minh
City-based chief executive officer of PXP, in a note to clients dated
Monday. Vietnam’s year-on-year inflation reached 28.3 percent in
August, the highest since at least 1992, before slowing in September to
27.9 percent. The country’s trade deficit widened 87 percent in the
year to September to US$15.8 billion, according to preliminary figures
from the General Statistics Office in Hanoi.
Earlier ‘collapse’
The pace at which the trade gap is widening slowed
from 109 percent year-on-year in the year to August. The September
deceleration in inflation was the first since January 2007. A slowdown
in bank credit growth, imports and expenditures by state companies have
helped cool the Vietnamese economy, Credit Suisse Securities (Thailand)
said last month.
The mid-year investor focus on worsening economic
indicators in Vietnam meant the VN-Index “collapsed several months
before everything else did,” Snowball wrote. Vietnam is “well ahead of
the crisis curve that the rest of the world is plunging into,” and has
“a generally stronger macro structure” than earlier in the year,
HCMC-based fund manager Dragon Capital said this month.
“A sustained bounce from the bottom is more
justifiable in Vietnam than elsewhere given its relative global
financial isolation,” Snowball wrote.
The country has “zero exposure to toxic assets” and
many foreign-invested projects in the country aren’t wholly dependent
on rising demand, instead taking production market share from competing
countries, Dragon Capital said.
Recent suggestions in the Vietnamese media that
Vietnam may be regarded as a global safe haven are “naive,” wrote
Snowball of PXP. “But you’ve got to love the optimism.”
benefits for Vietnam that may contribute to a stock-market rally,
according to PXP Vietnam Asset Management Ltd.
The Ho Chi Minh City Stock Exchange’s VN-Index Tuesday
rebounded 17.66 points, or 4.75 percent, to close at 389.33. The
measure declined 16 percent last week, the biggest fall since a
five-day slide that ended on October 5, 2001.
The International Monetary Fund last week forecast
global economic growth will slow to 3 percent in 2009, from 3.9 percent
this year and 5 percent in 2007, as a result of ailing banks and a drop
in property values.
“A global slowdown should act to moderate the
difficulties – high inflation and a widening trade deficit – that got
Vietnam here in the first place,” wrote Kevin Snowball, Ho Chi Minh
City-based chief executive officer of PXP, in a note to clients dated
Monday. Vietnam’s year-on-year inflation reached 28.3 percent in
August, the highest since at least 1992, before slowing in September to
27.9 percent. The country’s trade deficit widened 87 percent in the
year to September to US$15.8 billion, according to preliminary figures
from the General Statistics Office in Hanoi.
Earlier ‘collapse’
The pace at which the trade gap is widening slowed
from 109 percent year-on-year in the year to August. The September
deceleration in inflation was the first since January 2007. A slowdown
in bank credit growth, imports and expenditures by state companies have
helped cool the Vietnamese economy, Credit Suisse Securities (Thailand)
said last month.
The mid-year investor focus on worsening economic
indicators in Vietnam meant the VN-Index “collapsed several months
before everything else did,” Snowball wrote. Vietnam is “well ahead of
the crisis curve that the rest of the world is plunging into,” and has
“a generally stronger macro structure” than earlier in the year,
HCMC-based fund manager Dragon Capital said this month.
“A sustained bounce from the bottom is more
justifiable in Vietnam than elsewhere given its relative global
financial isolation,” Snowball wrote.
The country has “zero exposure to toxic assets” and
many foreign-invested projects in the country aren’t wholly dependent
on rising demand, instead taking production market share from competing
countries, Dragon Capital said.
Recent suggestions in the Vietnamese media that
Vietnam may be regarded as a global safe haven are “naive,” wrote
Snowball of PXP. “But you’ve got to love the optimism.”