(VOVworld) – Ho Chi Minh City contributes 90% of Vietnam’s stock market value. Last year the city recorded capitalization growth of 30% and market liquidation of 24%. The authorities and businesses expect that the stock market will do better this year.

The gong beating ceremony on the debut of the 2017 new stock trading year at the Ho Chi Minh City Stock Exchange. (Photo: Hoang Hai/VNA)

At the Ho Chi Minh City Stock Exchange (HOSE)’s first trading session of the New Year, Secretary of the municipal Party Committee Dinh La Thang  said with last year’s results and acceleration of state-owned enterprise equitization, the city’s stock market will have momentum to grow this year.

Mr. Thang pledged “to help businesses become stronger and more efficient. We’ll help businesses and the Stock Exchange grow because their success is Ho Chi Minh City’s success.”

Economists say the stock market continues to be an effective channel for mobilizing resources for the economy. Ministries and sectors have stepped up national economic reform and state-owned enterprises equitization. Last year large-cap stocks pushed the market up, with seven of the 10 highest-valued stocks gaining, including Vinamilk, BIDV, Vietcombank, Vietinbank, and insurer Bao Viet Holdings.

In January, the Vn-Index surpassed 697 points, up 5% since late 2016. It was VN-Index’s highest mark in 9 years. Economist Tran Hoang Ngan said: “This year, Vietnam’s stock market will have more commodities. Market capitalization will amount to about 50 or 60 percent of the national gross domestic product.”

The ceremony marking the 20th anniversary of Vietnam’s securities sector. (Photo credited by the State Securities Commission)

Vice General Director of the Ho Chi Minh City Stock Exchange Le Hai Tra recommends raising Vietnam’s stock market ranking to attract foreign investment. He said “We have to increase the number of big companies on the bourse and the rank of Vietnam’s stock market. It will help draw foreign investment to Vietnam.”

According to Vu Bang, Chairman of the State Securities Commission (SSC), there will be more opportunities for HOSE to grow stronger in 2017 as the government continues to remove difficulties for enterprises.

“We’ll continue to reform the structure of Vietnam’s stock market and bourses in HN and Ho Chi Minh City to make them more dynamic,” said Bang.

Equitization of state-owned enterprises will increase commodities for the stock market and create a new investment wave for HOSE in particular. In addition, flexible monetary policies in 2017 and steady interest rates will create more growth opportunities for the stock market.