The capital inflow into Vietnam's stock market is expected to grow in 2014 along with innovations in policies and improvements in the macro-economy, local media reported Thursday, quoting forecast by experts from the FPT Securities.
This would boost the benchmark indices on both the bourses of the country, said experts.
Investors would remain cautious when they return to the market which will resume operations on Friday after the nine-day holiday for the Lunar New Year.In the short term, the VN-Index is expected to fluctuate in a narrow band of 550-560 points, but the market trends will be positive, FPT Securities said.
In the long term, the index could reach 600 points in the best- case scenario, 550 in the medium-case scenario and 500 points in the worst-case scenario.
Vietnam's stock market in the last few months of 2013 and in January 2014 witnessed a shift of capital flow from speculative stocks to blue chips with improved liquidity.
Foreign capital was the highlight of blue chips. In December 2013 and January 2014 alone, the net buying value of the foreign investors reached 2.37 trillion VND (roughly 1.12 billion U.S. dollars), reflecting investors' confidence in the recovery and development prospects of the stock market of Vietnam.
More room for foreign investors at listed companies was a hot topic over the past few months. Once a regulation is passed, it will boost foreign capital in the stock market, experts said.
According to the Vietnamese State Securities Commission, the regulation was under consideration and would be issued soon.
In addition, a series of large state-owned enterprises such as Vietnam Airlines, Vinatex and Vinamotor, which are expected to be privatized or offer initial public offerings (IPO) in 2014, would help improve the equity supply.
The founding of the Vietnam Asset Management Company (VAMC) with its capacity to handle bad debts is expected to have positive impact on the stock market, said experts, adding that the decree about derivatives, expected to be issued this year, would be another stimulator.