INVESTMENT STRATEGY – MAR 2026– SECTOR OPPORTUNITIES AMID MIDDLE EAST TENSION

• The current escalation in the Middle East had, in fact, been anticipated by various international institutions and geopolitical analysts. Nevertheless, its outbreak has still delivered a substantial shock to global financial markets. The element of surprise does not stem from the occurrence of conflict itself, but rather from Iran’s resilience capacity—reflected in domestic social cohesion and the continued functioning of state institutions despite the loss of several senior leaders following multiple airstrikes. In this context, the primary risk lies in the elevated level of uncertainty surrounding the conflict, particularly regarding its duration. Given the historical characteristics of geopolitical tensions in the Middle East, a protracted conflict scenario—potentially extending well beyond initial expectations—has become a material risk that must be incorporated into strategic assessments.
• Under such circumstances, energy prices have surged following Iran’s obstruction of oil shipments—accounting for approximately 20% of global supply—through the Strait of Hormuz, or in the event that major oil and LNG producers such as Qatar suspend production. A sustained spike in commodity prices would amplify global inflationary pressures, raise production costs, and heighten the risk of broader macroeconomic repercussions, including global recessionary pressures, contraction in international trade, and renewed disruptions across supply chains.
• Vietnam is among the economies likely to experience significant indirect impacts, given its high degree of trade openness and reliance on global supply chains. Moreover, relatively modest foreign exchange reserves, coupled with a strengthening U.S. dollar and other reserve currencies, could intensify exchange rate pressures. Funding constraints may also emerge, potentially exerting upward pressure on domestic interest rates in the period ahead.