Vietnam stock market has recover in term of indicators, scales and internal force
Scene of the talkshow |
The market has regained what has been lost
At the talkshow “The Rise of the Vietnam Stock Market after Covid-19 pandemic”, Ta Thanh Binh, Director of the Securities Market Development Department (State Securities Commission), said 2020 was a turbulent year for the stock market. Under the impact of the Covid-19 pandemic, the local market fell deeply in the second quarter of 2020 with a decline of 33%. However, the market had recovered quite well and was better than other countries in the region and around the world.
Notably, the market's climb was receiving a positive push from domestic cash flow, especially from new investors entering the market. In September, 31,418 new securities accounts were opened by individual investors, accumulated in the first nine months of 2020 reaching 252,026 accounts, 34% higher than the number of new accounts opened in 2019. The number of accounts increased and the transaction increased, making the market more and more exciting. The average trading volume on the HOSE and HNX in the second and third quarters jumped nearly 40% over the same period last year.
“We have almost regained what we lost from the beginning of the year. Market capitalisation reached 71.3% of GDP. This showed a recovery in index, scale and internal force,” Binh said.
Analysing more closely, Binh said in the past, the movement of foreign capital inflows always strongly influenced Vietnam and market movements could even be predicted according to the trend of the stock market. But now was different, internal force factors have shown clearly and did not depend on the movements of foreign investors or foreign capital flows. The Vietnamese stock market has shown a strong vitality, especially before the Covid-19 pandemic.
However, in the opposite direction, Bui Hoang Hai, Director of the Securities Offering Management Department (State Securities Commission) said that, currently, across the world, the Covid-19 pandemic was still developing and it had not been determined when the pandemic would end. Therefore, we should use the "new normal" for this period, moving from one equilibrium phase to another.
According to Hai, the State Securities Commission's statistics showed the liquidity on the underlying market increased by 2.7% and also jumped by 90% of transactions on the derivative market in the past period. Market liquidity was above expectations. However, an important market factor is the decline in capital mobilisation and certain difficulties.
“Raising capital from international bond issues has decreased significantly. This was due to the Covid-19 pandemic making it impossible for foreign investors to come to Vietnam to do research. Currently, some major transactions were planned to subtract first because of Covid-19 pandemic," Hai analysed.
Note the fundamental stocks
Speaking at the talkshow, Le Duc Khanh, Director of Investment Capacity Development Department of VPS Securities Company, said that according to statistics, individual investors newly opened from the second quarter to now have increased quite strongly. However, compared with the population size, it was still very modest at about 300,000 new accounts opened in the recent period. Compared to many countries around the world, the number of new investors investing in the Vietnamese stock market was much lower.
“With the economic outlook, interest rates were very low due to the large amount of money available in the banking system, which made investors look to other investment channels like stocks. The growth space of the Vietnamese stock market was still very large, creating many investment opportunities,” Khanh said.
According to this expert, with a large amount of disbursement and circulation in the market, the VN-Index might continue to rise in the near future. Especially in the fourth quarter, industry groups were forecast to have good growth and the State Bank was maintaining low interest rates, which would help cash flow into the market.
“Investors should pay attention to choosing basic industry groups with good growth to minimise investment risks. Personally, I think that the market would return to the 990 - 1000 point mark in the end of 2020 soon," Khanh said.
Related News
Removing difficulties in public investment disbursement
09:30 | 31/10/2024 Finance
Accelerate implementation of solutions to disburse public investment capital
09:25 | 02/10/2024 Finance
Continue to publicly disburse public investment capital, many key projects have low rates
09:01 | 07/09/2024 Finance
Public investment disbursement rate in 8 months reaches about 40.5% of the plan
09:13 | 06/09/2024 Finance
Latest News
Continue to handle cross-ownership in banks
10:35 | 02/11/2024 Finance
Striving for average CPI not to exceed 4%
16:41 | 01/11/2024 Finance
Delegating the power to the government to waive, lower, or manage late tax penalties is suitable
16:39 | 01/11/2024 Finance
State-owned commercial banking sector performs optimistic growth, but more capital in need
09:28 | 31/10/2024 Finance
More News
Stipulate implementation of centralized bilateral payments of the State Treasury at banks
09:29 | 29/10/2024 Finance
Rush to finalize draft decree on public asset restructuring
09:28 | 29/10/2024 Finance
Inspection report on gold trading activities being complied: SBV
14:37 | 28/10/2024 Finance
Budget revenue in 2024 is estimated to exceed the estimate by 10.1%
10:45 | 28/10/2024 Finance
Ensure timely and effective management and use of public asset
11:31 | 27/10/2024 Finance
Accelerating decentralization in public asset management
11:26 | 26/10/2024 Finance
Difficulty in finding banks eligible to receive compulsory transfers
15:49 | 25/10/2024 Finance
Businesses can choose a suitable electronic invoice model generated from the cash register
14:18 | 25/10/2024 Finance
State budget revenue estimate 2025 assessed as positive level despite potential challenges
14:49 | 24/10/2024 Finance
Your care
Continue to handle cross-ownership in banks
10:35 | 02/11/2024 Finance
Striving for average CPI not to exceed 4%
16:41 | 01/11/2024 Finance
Delegating the power to the government to waive, lower, or manage late tax penalties is suitable
16:39 | 01/11/2024 Finance
Removing difficulties in public investment disbursement
09:30 | 31/10/2024 Finance
State-owned commercial banking sector performs optimistic growth, but more capital in need
09:28 | 31/10/2024 Finance