Stocks are trading at fair value at the moment, and we expect investors to pause and wait for more news on the economic situation in the US before continuing their buying.


We are seeing increasing signs that the very worst of the crisis is now over in the US, though unemployment is likely to rise for many months or years to come and the recovery process will be long and painful.


Here in Vietnam, the second quarter will be crucial for companies to prove that they can hold on to existing customers and seek new sales channels to continue to grow.


Investors with a time horizon of over one year should invest now because the Vietnamese market is likely to move back on to its long-run growth trend by then. For investors with shorter time horizons, we advise a wait-and-see approach for the next month.


We anticipate sideways movement for the next month as investors slow down and wait for first-quarter earnings to slowly trickle in after the April 15 due date.


The market is likely to pick up again only on news of a renewed stock rally in the West, positive economic data from China indicating a resumption of industrial activity there, and good earnings reports from key Vietnamese blue chips.


A lurking factor is the unrest in Thailand. If investors get spooked by the continuing unrest, Vietnam could be the beneficiary of funds earmarked for Southeast Asia being diverted from Bangkok to Ho Chi Minh City.


Overall, we expect another bull market may develop sometime in the third quarter if domestic economic data beats expectation and as Vietnam’s relative resilience to the economic crisis becomes more widely known in the investment community.