Expert: Stock market decline is normal, investors need to stay calm

Investors are overreacting.

This morning's trading session (April 3), the stock market was sold off widely. VN-Index at times dropped up to 80 points, the index dropped deeply below 1,240 points. Red dominated, money flowed out of the market with liquidity on HoSE of nearly 28,000 billion VND, many codes fell to the limit.

In the context of strong market fluctuations, speaking to Dan Tri reporter , economic expert Le Xuan Nghia said that investors are overreacting, leading to panic and widespread selling pressure. "Panic is spreading, creating a chain effect even for stocks with solid foundations," Mr. Nghia analyzed.

According to this expert, it is inevitable that industries directly affected by the new import tax policy such as seafood, textiles, rubber, fertilizers, etc. will face selling pressure. More notably, investors are also dumping stocks in fundamentally stable sectors such as banking and securities - sectors that are only indirectly affected.

"The market always moves according to the law of supply and demand. When one group of investors sells, another group will see the opportunity and be ready to buy," experts said, predicting that market liquidity may peak in today's trading session.

Responding to Dan Tri newspaper reporters , Mr. Dinh Minh Tri - Head of Analysis, Individual Client Division, Mirae Asset Securities Company - said that US President Donald Trump's announcement of a series of new tax policies, including a 46% rate for Vietnam, exceeded the forecasts of experts and investors. The normal rate is predicted to be around 15-25%.

This unexpected tax figure has clearly reflected in the stock market this morning, at one point the VN-Index dropped by 70 points, also one of the sharpest declines in history. Industries closely related to the US such as exports, seafood, information technology, construction materials... were all strongly affected.

Experts say market fluctuations are normal, investors need to control their psychology (Illustration: Hai Long).

Expert Dang Tran Phuc - Chairman of the Board of Directors of AzFin Vietnam (a financial company) - commented that the Vietnamese stock market has made a strong adjustment after the announcement of the US imposing a tax of up to 46% on Vietnamese goods. According to him, investors need to understand 5 factors.

First, not all Vietnamese goods exported to the US are subject to this tax rate. Some goods have a total tax rate higher than 46%, but most have a tax rate much lower than 46%.

Second, the proportion of Vietnam's exports to the US is large, about 29.47% of total export turnover (119.5 billion USD compared to total export turnover of 405.53 billion USD), so there will be a big impact but not all. Because Vietnam also exports to other economies.

Third, the tax rate set by the US government is not fixed but can be renegotiated with countries of good will. The US also has suggestions for countries in a publication of more than 400 pages, including 8 pages about Vietnam. Therefore, Vietnam can rely on that to have timely solutions to minimize risks.

Fourth, not only Vietnam is subject to tariffs, countries around the world that have significant trade relations with the US are subject to tariffs.

Fifth, the enterprises most directly affected are mostly foreign-invested enterprises (FDI). Listed enterprises have an impact ratio of no more than 20%, of course there will be cross-influence.

How to understand correctly the 46% tax policy with Vietnam?

The US decision to impose a 46% tax on Vietnamese goods is having a strong impact on the financial market, especially the stock market. According to Associate Professor Dr. Nguyen Huu Huan - Lecturer at Ho Chi Minh City University of Economics (UEH), this new tax policy not only affects export enterprises but also disrupts the entire global economy.

US President Donald Trump’s policies are constantly changing, creating shocks on a global scale. Immediately after the announcement of the new tax rate, gold prices skyrocketed due to concerns about rising US inflation and a weakening US dollar. This reflects the major impact of the tariff decision on international financial markets.

In the Vietnamese market, the group of stocks that benefit from this policy mainly belong to enterprises focusing on the domestic market or exporting to regions other than the US. In contrast, stocks of enterprises exporting directly to the US will be heavily negatively affected.

US President Donald Trump announced new tax policies at an event in the Rose Garden, inside the White House on April 2 (Photo: Reuters).

According to Mr. Huan, the current tax rate of 46% may not be the final number. It is likely that the Trump administration will adjust it to a lower level, but still around 20%, instead of bringing it to 0% as before.

The question, however, is whether this tax policy will last. History shows that Mr. Trump’s policies often have a strong impact at the beginning but can gradually decrease, similar to the way the US imposed tariffs on China in 2018 and then reduced them. However, according to experts, if the US persists with this policy, the risk of a large-scale trade war - even accompanied by a currency war - is inevitable.

According to Mr. Huan, to minimize the impact of the US tax policy, Vietnam needs to take strategic steps. First, it needs to find ways to reduce the trade deficit with the US by increasing imports of goods from this country. Measures such as exempting import duties or creating more favorable conditions for US goods to enter Vietnam can help improve the trade balance and demonstrate goodwill for cooperation.

On the other hand, Vietnamese businesses also need to adjust their export strategies to avoid being considered by the US as a "transit station" for goods from other countries to avoid taxes. This requires stricter regulations on the origin of goods and localization rates to ensure transparency and promote the development of domestic production.

The current context is also an opportunity for Vietnam to enhance its economic autonomy. According to Mr. Huan, "the time has come, the question is whether we can take advantage of it or not". To do that, Vietnam needs to strongly develop private corporations, creating leading enterprises capable of leading the economy and reaching international standards.

The draft Resolution on private economic development that is being drafted is expected to create breakthrough policies to help Vietnamese enterprises truly grow. One of the key factors is to increase the localization rate in production and export, thereby reducing dependence on external markets and increasing the ability to adapt to international fluctuations.

The US imposition of high import tariffs on Vietnamese goods is a big risk, but also a "test" of the economy's adaptability. Vietnam needs to quickly develop response scenarios, even in the worst case, to avoid being passive and to be able to come up with timely response policies.

Although the evolution of US policy remains uncertain, one thing is certain: Vietnam needs to be prepared to face changes and at the same time take advantage of opportunities to enhance its economic strength.

Investors need to stay calm

In the short term, Mr. Dinh Minh Tri believes that the stock market will be negatively affected in today's and tomorrow's sessions.

During the session, the market may have some moments of recovery in today's session but it will be difficult to be strong. The recovery may be clearer next week. The impact of the tax policy may last for 1-2 months, then will be adjusted when countries negotiate with the Trump administration.

According to Mirae Asset’s representative, the tax policy and tax figures that Mr. Trump mentioned need time to review because everything is not clear yet. Investors need to stay calm, find a way to handle and make decisions, avoid panic and cause unnecessary risks.

According to Mr. Tri, investors should avoid using margin at this time. The market will always have positive stocks and industry groups. Some industries unrelated to the US or highly defensive such as milk, pharmaceuticals, gasoline, etc. may bottom first. The remaining groups may bottom later, possibly this month or when FTSE announces the upgrade. Investors can make reasonable decisions based on their risk tolerance.

For value investors, Mr. Dang Tran Phuc recommends reviewing whether the asset allocation is reasonable. If the stock ratio is too high or leverage is used, it should be reduced to avoid pressure if a collapse occurs.

For investors with a low asset ratio for stocks and available cash, Mr. Phuc said they can take this opportunity to buy and accumulate more stocks with strong competitive advantages, good financial foundations, and high cash dividends.

Regarding the overall portfolio, Mr. Phuc believes that investors need to meet criteria such as having a relatively high dividend cash flow, at least over 4%; a reasonable allocation structure among sectors according to the proportion in the VN-Index to avoid concentration risks if a bad situation occurs. In addition, leading stocks, which are less directly affected by the US tax imposition, will be the stocks that recover the most strongly after the difficulties.

Regarding the market outlook, expert Le Xuan Nghia said that the current strong fluctuations in the stock market are opening up opportunities for long-term investment strategies. However, he said that investors should be cautious and apply a partial disbursement strategy.

"This is not the time to put all your money into the market. Observe, choose carefully and disburse gradually to control risks. No one can be sure whether the market will continue to decline tomorrow or not," Mr. Nghia emphasized.

Source: https://dantri.com.vn/kinh-doanh/chuyen-gia-chung-khoan-giam-la-binh-thuong-nha-dau-tu-can-binh-tinh-20250403112617046.htm