The stock market will track the bottom, Ms Phan Van Ha, General Director of Artex Securities Corporation, said when she mentioned the impressive rally of the Vietnamese stock market and the expected trends of the VN-Index from now to the end of this year.
What are your viewpoints about the second stimulus package?
The Government should launch the second stimulus package to assist enterprises and spur economic growth. Although there is no confirmed information on the ratification of the second stimulus package but it is anticipated a high possibility. However, businesses should know that the second stimulus package, if it is launched, will have narrower scope and beneficiaries. I think the second stimulus package will focus on three main objectives. Firstly, the package may increase investments for rural areas to upgrade irrigational systems and purchase agricultural materials and machines to create jobs, increase incomes and strengthen purchasing power. Secondly, the package is used to restructure the domestic consumption market to enable Vietnamese consumers to use high quality goods. The third is to enhance the governance of the central and local governments.
With positive signals of economic recovery, the stock market has rallied strongly and set up new records of trading value and volume. Some said a portion of stimulus money has been channelled into the stock market. What do you say about this?
In fact, the stock market has unexpected growths in trading volume and value. The cash flow into the Vietnamese stock market is largest-ever. Following the launch of the first stimulus package, a large amount of cash was injected into the economy and a part of stimulus did not go to production as initially expected but to the stock market as some has said. Although the economic growth slowed down, stock trading contrarily surged. The stock market peaked in 2007, declined in 2008 and reached the four-year low of 235 points in 2009. Thus, investors’ assets had declined very much from 2007 – 2008 but the cash pumped into the stock market soared. This is the reason why many have thought the stimulus money has been channelled into the equity market.
In my opinion, the rally of the stock market comes from two main reasons. Firstly, cash flows are very large and may be from stimulus package. Secondly, the stimulus package helps improve corporate earnings and attract investors to join the stock market.
The growth of the stock market through the Government’s economic interventions is reflected in two points: The uptrend of market indices and the increasing flow of cash into the stock market.
However, better earnings results reported by many companies do not actually come from improved business performances but from the return of provision funds made last year. Thus, when we evaluate the real performance of a company, we need to separate the profit from the return of provision funds. Then, we will have a more accurate evaluation of target companies as well as the economy as a whole.
I think we cannot forget the information transparency of listed companies. Only information transparency ensures the healthy development of the stock market and makes it a playground of brains.
The stock market has perked up and competition amongst securities brokers accelerates. What human resources, marketing and business strategies has Artex Securities Corporation adopted to boost business performance?
At present, to ensure sustainable development, Artex has introduced strategies to develop brokerage and consulting services to increase the market share by unique services. The company has renovated and introduced exclusive products and services only found at Artex while expanding the customer care network in many provinces and cities to provide services to the customers in the most convenient way.
Besides, we also pay due attention to investing in IT infrastructure to enhance the quality of service quality. Additionally, we also strengthen PR activities, develop human resources and build a professional broker force as good as in securities brokerage houses in developed nations.
From the effect of the stimulus package, could you anticipate the trends of the stock market in the last months of 2009 and the first months of 2010?
The stimulus package of the Government has certain effect although there are still some shortcomings. In my opinion, this is only a “reliever” and the economy in general and the stock market in particular may encounter difficulties again. In the remaining months of this year, the stock market may experience correction periods. The VN-Index may create the yearly high in mid-November. Then, the market will track the bottom until the end of the first quarter of 2010 before going out of the bottom zone.
Reported by Anh Phuong
Vietnamese
