Strict measures to address fraud in the stock market may impact investors’ sentiment in the short term but eventually benefit the stock market in the medium and long term, Minister of Finance Ho Duc Phoc told the local media regarding recent movements in the stock market.
|Minister of Finance Ho Duc Phoc.|
“The main goal of the Government is to ensure the development of the stock market towards safety, transparency, and sustainability,” Phoc said, adding that its efforts to cleanse the market would help protect the lawful rights of compliant investors and businesses, as well as to enhance the market attractiveness.
Referring to sharp drops of the Vn-Index in recent sessions, Phoc attributed it to the combination of both external and internal factors.
He said rising inflationary pressure in the global market is forcing key central banks to tighten monetary policies, including the FED’s decision of raising its policy rates for the first time after three years.
In addition, the ongoing Russia-Ukraine conflict has increased risks against global economic recovery as it has caused hikes in the prices of energy and input materials.
“Many stock exchanges have suffered from a negative economic environment, and Vietnam is no exception,” he said.
Meanwhile, the Government’s crackdown on fraud cases in the stock and corporate bond markets has also impacted investors’ sentiments.
“But deceits in the stock market are only occasional and expected to have a short-term impact, and the recent moves show the determination of the Government in ensuring the market’s healthy development,” Phoc stressed.
“In every course of development, there are always necessary changes to improve the market for sustainable growth,” he continued.
Phoc remains adamant about the bright prospects of the market thanks to Vietnam’s solid economic fundamentals and the market’s strengths.
“We have reasons to believe in a bright future for Vietnam’s market that would only grow stronger and become a key capital mobilization channel in the medium and long term for businesses, investors, and the economy,” he said.
On April 25, the Ministry of Finance (MoF) held a meeting with the Ministry of Public Security and agreed on not criminalizing offenses in civil economic transactions.
At the meeting, a representative of the MoF said it would provide the utmost support for compliant businesses and investors while taking strict measures to address fraud.
“We respect the market mechanism with ups and downs based on the supply-demand relations, but at the same time to supervise and intervene, if needed, in compliance with the law,” Phoc said.
In the coming time, the MoF would continue to finalize the legal framework to support the market development, including the revision of the Securities Law and the Business Law to better reflect the development of the stock market.
The benchmark Vn-Index at the close of yesterday's trading session went up 30 points to 1,341, the highest gain since the beginning of the year. This shows the investors may have regained confidence in the market after the index plunged to its eight-month low of 1,310.92 in the previous session, a drop of 78 points or 5.4%.