VietNamNet Bridge - The good performance of macroeconomic indexes has supported the strong rise of the stock market, which has experienced the best six-month period in the last nine years with growth rate of 14.4 percent. 

Not all investors are optimistic about the stock market, but the majority of institutions and individuals believe the VN Index can continue to rise.  

Even if Vietnam remains a ‘frontier’ market, Vietnam will still attract foreign investors, and it is the growth rate which will be a decisive factor attracting foreign capital flow.

By early July, the VN Index had increased by 17 percent compared with the beginning of the year, hitting a 9-year high. 

The good performance of macroeconomic indexes has supported the strong rise of the stock market, which has experienced the best six-month period in the last nine years with growth rate of 14.4 percent.

Meanwhile, the HNX Index had increased by 23 percent. The impressive growth rates have helped increase the capitalization value of the market to 2,500 trillion, an increase of 25.7 percent compared with the end of 2016.

Amid the strong investment wave, foreign investors’ net purchases reached VND9 trillion in the first six months of the year, which was a contrast to the net sale movement seen in the last months of 2016.

Chair of LMC Investment & Trade Lam Minh Chanh said the enthusiasm of foreign investors gave a strong push to the market development.

Commenting about the driving forces of the stock market, Vo Tri Thanh from CIEM mentioned the new government; the economy and the presence of new leaders and new policies in the world’s economy.

Le Dang Doanh, a renowned economist, commented that Vietnam’s stock market has been thriving on the basis of clear policies and a deeply integrated economy.

The FTAs Vietnam has signed bilaterally and multilaterally show its commitments not only to cut tariffs to pave the way for trade liberalization, but also commitments to carry out institutional reform.

Doanh also commented that the new government has made great strides in encouraging private businesses and reforming state-owned enterprises. Deputy PM Vuong Dinh Hue has requested over 700 equitized enterprises to list shares on the bourses.

Once businesses list their shares, the capitalization value will increase, thus making the stock market more attractive.

The moves taken by the government recently show the government’s special attention to the development of private economic sector. The government has released a series of resolutions to improve the business environment, while the PM met private businesses and listened to their opinions.

Thanh believes that it is confidence in Vietnam’s reform which has had a good impact on the stock market.

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