Vietnam's stock market ended 2010 with unfavourable results for all investors. How the stock market changes for the remaining months of 2011, following the comments on anumber of opportunities and risks affecting the stock market.
Key numbers in 2010
- 6.75% of GDP (6.5% planned), CPI at 11.7% (8% planned)
10-year average in 2001 -2010 GDP of 7.2% and CPI of 8.8%
- Credit growth is 27.65%. Credit growth in foreign currencies is 37.76%, large higher compared in VND at 25.34%
- Vnindex and Hnxindex ended 2010 at 484.66 points and 114.24 points, corresponding a decrease by 2% and decreased 32.1% from a year earlier.
- Total mobilized capital on the stock market is VND 116 trillion, equivalent to 25% of the total social investment. Foreigners bought a net VND 16.200 billion on both HSX and HNX.
Opportunities
1 Stock market drastically fell in 2010, Hnxindex down 32%. Stock price was low, P/E at attractive level of 11x. Commodity markets, including gold, foreign currencies and real estate have heat up over the past year. This is an opportunity for the stock market on the principle of acidic water, especially the medium and long term investment, because Vietnam is in the club by 7%, many listed companies to maintain high growth rates.
2 WTO integration deeper, particularly the finance- bank sector, the money likely to flow into Vietnam more strongly in 2012, when the technical barriers completely removed under WTO commitments. The Chinese hold a strong hand as well as lower inflation growth, particularly in the field of real estate in foreign capital flows can cause shifts in the market such as Vietnam.
3 Effect of the stability of political systems, 2010 was a difficult year for stock market when macroeconomic policies are not agreed. State Securities Commission of Vietnam-SSC-was not creating new products for the market. 2011, Government has a clear perspective is the priority of macro stability. 2011 will be the first year implementation strategy developed stock market 10 years from now to 2020, the SSC has signalled its development new products.
Risk
1 The risk of a cash flow
1.1 2011 credit growth target is 23%, (compared to 25% in 2010), and particularly cash flow will be directed to the agricultural and production areas . Capital inflows to the stock market will be more limited.
1.2 The supply of securities on the stock market in 2011, including stocks and bonds would require a large amount of money.
1 The risk of a cash flow
1.1 2011 credit growth target is 23%, (compared to 25% in 2010), and particularly cash flow will be directed to the agricultural and production areas . Capital inflows to the stock market will be more limited.
1.2 The supply of securities on the stock market in 2011, including stocks and bonds would require a large amount of money.
Supply of stocks, including business listings, business capital expansion, including banking and capital restructuring of state enterprises. The value of securities issued to the public in the first 9 months of 2010 reached 34,622 billion VND. In 2011, HNX plan at least 100 new listed companies, and HSX plan to increase the total value of new listing at least equal to 2010, corresponding to VND 23,000 billion. Government will strengthen the state capital sale: SCIC has sold the state capital in 2010 at 106 businesses and plan to sell 281 business in 2011. In addition, pressure to withdraw funds from the state corporation under the direction of the government avoided investment spread and improve efficiency.
For the bond market, including corporate bonds and government bonds. Vietnam enterprises are increasingly aware of the importance of raising capital through the medium and long term channel as bond market, the value increased from issuing more than VND 26 trillion in 2009 to around VND 47 trillion in 2010, The average interest rate of about 14% -16%. Government bond is expected to issue VND 45 trillion in 2011. (2010 is VND 55 trillion, approximately12% interest rate). Scale of Vietnam's bond market is still small (17% of GDP, while in Thailand is 58%, Singapore 74% and China is 53%) and interest rates bank are expected to maintain a high level in 2011. Then, bond market will continue to thrive.
2 The risk of volatility price as food, gold and dollar.
Most experts identify commodity prices will continue to increase in 2011, and gold remains a big mystery after up to 29% in 2010. In Vietnam, power shortages will be more severe, pressure on prices is very large in coal, power in 2011, increasing input costs of production. In 2010 in the context of inflation, exchange rates and interest rates were rising, 2011's forecast is still very difficult for businesses.
3 Macro policies risk: the government machinery will be established in the next national assembly session in May. There will be no sudden policy from now, and then the transfer time. The new engine needs time to have specific goals and steps taken to plan for 5 years and 10 years.
Most experts identify commodity prices will continue to increase in 2011, and gold remains a big mystery after up to 29% in 2010. In Vietnam, power shortages will be more severe, pressure on prices is very large in coal, power in 2011, increasing input costs of production. In 2010 in the context of inflation, exchange rates and interest rates were rising, 2011's forecast is still very difficult for businesses.
3 Macro policies risk: the government machinery will be established in the next national assembly session in May. There will be no sudden policy from now, and then the transfer time. The new engine needs time to have specific goals and steps taken to plan for 5 years and 10 years.
A number of other issues on the stock market as investors' confidence, in 2010 the confidence of investors has declined in part due to "pushed price" stocks. This phenomenon in 2011 will reduce by (1) this operation have finally brought many implications for investors, including those active in the price, (2) the SSC has been and will strong hand to continue with this operation, and (3) and the stock market tend to develop based on fundamental values, so that goes against the fundamental values will not be many "land." However, other issue have appeared as the current Vnindex not reflect the face of the whole market. SSC for the moment have no solution, this may pose a risk to the market and investors.
Overall supply of securities and monetary policy for 2011, the decisive factor is the cash flow into the stock market. If money supply is greater than stock supply, the stock market can grow, and foreign capital flows will certainly play an important role. Overall assessment for 2011, GDP reached the government target of 7% to -7.5%, CPI from 9% -10% (compared with 7% plan) and indicator Hnxindex will have joined 140 - 152 points area at time (compared to the 106.63 mark at the end of 2010).
Overall supply of securities and monetary policy for 2011, the decisive factor is the cash flow into the stock market. If money supply is greater than stock supply, the stock market can grow, and foreign capital flows will certainly play an important role. Overall assessment for 2011, GDP reached the government target of 7% to -7.5%, CPI from 9% -10% (compared with 7% plan) and indicator Hnxindex will have joined 140 - 152 points area at time (compared to the 106.63 mark at the end of 2010).
No comments:
Post a Comment