VN’s stock market sees volatility amid world’s less positive outlook

Việt Nam's stock market has seen strong volatility in recent years, stemming from investors' cautious sentiment in the face of uncertainties and less positive outlook on world economy and politics.
VN’s stock market sees volatility amid world’s less positive outlook
Investors look at stock indices on a computer screen. Domestically, cash flow on the stock market has been affected by changes in interest rates. Photo tinnhanhchungkhoan.vn

Việt Nam's stock market has seen strong volatility in recent years, stemming from investors' cautious sentiment in the face of uncertainties and a less positive outlook for the world economy and politics.

With the economic support measures after the COVID-19 pandemic, inflation has increased sharply in many parts of the world, prompting many economies to continue tightening monetary policy at a fast and strong pace to control inflation, said the State Securities Commission (SSC) at a meeting held in Hà Nội on Wednesday.

In 2022, the US Federal Reserve (FED) raised the operating interest rate by 3.75 percentage points through six consecutive adjustments; The Bank of England has adjusted interest rates up 7 times in a row since December 2021, to 2.25 per cent. The European Central Bank (ECB) has also adjusted interest rates three times already in 2022 in the context of inflation continuing to increase in this region. The move to tighten monetary policy in the world is raising concerns about the risk of recession and inflation in some countries.

The geopolitical situation will continue to be complicated and unpredictable. The Russia-Ukraine conflict, tensions between major countries and China's zero COVID strategy continue to aggravate disrupted global supply chains, and rising food and energy prices directly affect the costs of businesses and increase inflationary pressure, said SSC.

Domestically, cash flow on the stock market has been affected by changes in interest rates. After the Fed's continuous interest rate adjustments, the State Bank of Việt Nam has also increased the operating interest rate twice to cope with inflation and reduce external impacts, it said.

Deposit interest rates at commercial banks have also increased, attracting cash flow back to the banking system and reducing the attractiveness of short-term securities investment channels. In addition, investment capital flows on the stock market have also shifted to production and business activities as the pandemic is under control.

The stock market had grown strongly from 2021 to the first quarter of 2022. Therefore, when there are unfavourable factors, investors will tend to sell to take profits and avoid losses, creating selling pressure in the market. The investigation and prosecution of a number of large real estate enterprises in recent times related to violations in the issuance of corporate bonds have also affected the general sentiment on the stock market, creating cautious psychology, and affecting cash flow in the market.

The SSC said that it will continue to closely monitor developments in the economic-political situation around the world, and assess the impact and influence on Việt Nam's stock market in order to promptly take appropriate solutions to ensure the stable and transparent development of Việt Nam's stock market.

Recently on the stock market, there have been businesses increasing bond re-purchases, and individual investors selling bonds early due to concerns that businesses will not be able to repay their debts.

However, according to the Ministry of Finance, international practice and Vietnamese law both stipulate that corporate bonds are issued by enterprises on the principle of self-borrowing, self-paying and self-responsibility.

According to the Ministry of Finance, corporate bonds are not a bank savings deposit product but often have a higher risk when accompanied by high interest rates. With this feature, investors are responsible for self-assessing the level of risks when buying corporate bonds, and are responsible for their own investment decisions.

Therefore, when individual investors are invited to buy corporate bonds, they need to request the distributing organisation to provide complete and accurate information about the issuer and the bonds. Investors need to read carefully and understand provisions in bond documents and corporate information disclosures, said Deputy Minister of Finance Nguyễn Đức Chi.

When the issuer has payment difficulties, the investor can actively work with this business and the service provider to agree on a suitable settlement plan, ensuring the interests of both sides.

“Investors also need to pay close attention to the responsibilities and commitments of service providers. Commercial banks and securities companies distribute corporate bonds does not mean that these organisations guarantee the payment of debts. These organisations are only service providers, enjoying service fees from the issuer," said Chi.

However, the Ministry of Finance said the corporate bond market is still a potential market as enterprises are in need of capital for production and business development. Therefore, the Government's view is to continue to develop a safe, healthy and transparent bond market, said the Ministry of Finance.

Source: VNA

Related News

Vietnam kicked off the year with a strong start in trade, exceeding US$63 billion in the first month

Vietnam kicked off the year with a strong start in trade, exceeding US$63 billion in the first month

VCN - Data from the General Department of Vietnam Customs indicates a softening of both exports and imports in January 2025, relative to the same month in 2024.
Five solutions for developing stock market in 2025

Five solutions for developing stock market in 2025

VCN - On February 5, 2025, at the Gong-beating ceremony to open the stock trading at the Ho Chi Minh City Stock Exchange (HOSE), Deputy Minister of Finance Nguyen Duc Chi introduced five solutions for comprehensive development of the stock market.
Vietnam, Korea Customs sign AEO MRA

Vietnam, Korea Customs sign AEO MRA

VCN- The Director General of the General Department of Vietnam Customs (GDVC), Mr Nguyen Van Tho, and the Commissioner of Korea Customs Service (KCS), Mr Ko Kwang Hyo, signed the Authorized Economic Operator Mutual Recognition Agreement (AEO MRA) on the afternoon of December 24, at the GDVC’s headquarters.
Vietnam

Vietnam's stock market to develop strongly and sustainably

VCN - This was emphasized by Minister of Finance Nguyen Van Thang at the Conference to review the work of 2024 and deploy the work of 2025 of the State Securities Commission (SSC) held on the afternoon of December 18.

Latest News

Personal income tax proposed for interest on some bank savings accounts

Personal income tax proposed for interest on some bank savings accounts

Instead of the current personal income tax exemption on interest from all individual bank savings accounts, the proposal would exempt tax only for low amounts of savings.
Banks set for aggressive bond issuance in 2025 to fuel growth

Banks set for aggressive bond issuance in 2025 to fuel growth

With a higher credit growth goal set by the SBV, banks are ramping up their efforts to secure funding through bond issuance.
Central bank cuts interest rate on bills for first time in 2025

Central bank cuts interest rate on bills for first time in 2025

According to data from the financial data provider Wichart, the SBV issued VNĐ19.6 trillion of bills in the past week. The interest rate on the bills decreased by 0.1 percentage point, from 4 per cent to 3.9 per cent on February 14.
Focusing on inspecting inventory of public assets at units with large and complex assets

Focusing on inspecting inventory of public assets at units with large and complex assets

VCN - According to Official Dispatch No. 1456/BTC-QLCS on inspecting the preparation and implementation of the General Inventory of Public Assets recently issued by the Ministry of Finance, the inspection of the inventory of public assets focuses on units with large asset scale and large number of inventory items, complex assets, and slow implementation progress.

More News

The government seeks approval for revised GDP, CPI targets

The government seeks approval for revised GDP, CPI targets

VCN - The Government submitted to the National Assembly for consideration and comments on adjusting the target for the growth rate of gross domestic product (GDP) to 8% or more; the average growth rate of the consumer price index (CPI) to about 4.5-5%.
Fiscal, monetary policies support demand stimulation, price stabilisation

Fiscal, monetary policies support demand stimulation, price stabilisation

These efforts, in conjunction with the implementation of monetary policies and other macroeconomic policies, aim to solve difficulties for businesses and the public, stabilise the macroeconomy, control inflation, ensure the balance of the economy, promote economic growth, and secure social welfare and people’s livelihoods.
Vietnam secures VND 157 billion from state enterprise divestment in 2024

Vietnam secures VND 157 billion from state enterprise divestment in 2024

VCN - The Ministry of Finance reported that in 2024, the divestment of state capital in 5 enterprises (F1) generated VND 157 billion from an initial value of VND 145 billion
Vietnam gears up for potential inflation impact in 2025

Vietnam gears up for potential inflation impact in 2025

VCN - For sound price management and inflation control, Deputy Prime Minister Ho Duc Phoc directed officials to vigilantly track both domestic and international market dynamics. The goal is to proactively develop flexible strategies and solutions, enabling a swift response to any emerging challenges.
VN’s credit conditions in 2025 expected to be stable

VN’s credit conditions in 2025 expected to be stable

The credit conditions for Việt Nam will stabilise in 2025, after improving substantially over the past year, the rating agency VIS is forcasts.
State revenue in first month of the year equal to 14% of the estimate

State revenue in first month of the year equal to 14% of the estimate

VCN - According to the Ministry of Finance, in January - the first month of 2025, the total state budget revenue is estimated at VND275.9 trillion, equal to 14% of the estimate; meanwhile, the total state budget expenditure is estimated at VND134.4 trillion.
Securities 2025 expects a breakthrough in scale and quality

Securities 2025 expects a breakthrough in scale and quality

VCN – The positive factors inherent in the macro economy and the Vietnamese stock market will continue to create the foundation for the market to maintain stability, good liquidity, and growth in both scale and quality in the new year of At Ty 2025, Chairwoman of the State Securities Commission Vu Thi Chan Phuong said.
Cash reserves in stock accounts at six-quarter low amid margin rise

Cash reserves in stock accounts at six-quarter low amid margin rise

These funds are readily available in investor accounts, but remained undeployed as of the year-end.
Minister of Finance Nguyen Van Thang works with GDVC at the first working day after the Tet holiday

Minister of Finance Nguyen Van Thang works with GDVC at the first working day after the Tet holiday

VCN- On February 3, the first working day after the Tet holiday, Minister of Finance Nguyen Van Thang and the delegation visited and worked with the General Department of Vietnam Customs (GDVC).
Read More

Your care

Latest Most read
Personal income tax proposed for interest on some bank savings accounts

Personal income tax proposed for interest on some bank savings accounts

Instead of the current personal income tax exemption on interest from all individual bank savings accounts, the proposal would exempt tax only for low amounts of savings.
Banks set for aggressive bond issuance in 2025 to fuel growth

Banks set for aggressive bond issuance in 2025 to fuel growth

With a higher credit growth goal set by the SBV, banks are ramping up their efforts to secure funding through bond issuance.
Central bank cuts interest rate on bills for first time in 2025

Central bank cuts interest rate on bills for first time in 2025

According to data from the financial data provider Wichart, the SBV issued VNĐ19.6 trillion of bills in the past week. The interest rate on the bills decreased by 0.1 percentage point, from 4 per cent to 3.9 per cent on February 14.
Focusing on inspecting inventory of public assets at units with large and complex assets

Focusing on inspecting inventory of public assets at units with large and complex assets

VCN - According to Official Dispatch No. 1456/BTC-QLCS on inspecting the preparation and implementation of the General Inventory of Public Assets recently issued by the Ministry of Finance, the inspection of the inventory of public assets focuses on units
The government seeks approval for revised GDP, CPI targets

The government seeks approval for revised GDP, CPI targets

The Government submitted to the National Assembly for consideration and comments on adjusting the target for the growth rate of gross domestic product (GDP) to 8% or more
Mobile Version