Minister Ho Duc Phuc pointed out the cause of the “evaporation” of securities and the move from the Ministry of Finance

Acknowledging that the stock market has been in a period of strong volatility and deep downward adjustment since the end of March, Minister Ho Duc Phuc said, following 2021, the first quarter of 2022, the stock market The basic growth rate is still good and stable.

After setting a new peak, by the end of the first quarter of 2022, the VN-Index only decreased slightly by 0.4% compared to the end of last year.

The new market has been under downward correction pressure and strong volatility since the end of March until now. The VN-Index closed on April 25 at 1,310.92 points, so it has adjusted down by more than 200 points compared to the end of March.

Minister Ho Duc Phuc clarified the cause of the stock market’s “evaporation”

This is a relatively strong correction of Vietnam’s stock market under the combined influence of many different domestic and international reasons, both objective and subjective.

Accordingly, in the world, inflationary pressure increased, causing major central banks to tighten policies, most notably the US Federal Reserve (FED) raised the operating interest rate after 3 years. .

Along with that, the conflict between Russia and Ukraine increases the risks for the global economic recovery, especially when energy prices, input material prices increase sharply, etc. That has affected many stock markets. around the world, causing many markets to plummet.

Minister Ho Duc Phuc said that the Vietnamese stock market was no exception as selling pressure gradually increased at the end of the first quarter and corrected sharply since the end of March after a long process of continuous increase.

In addition to the external macro impacts, the stock market is also partly psychologically affected when the authorities and management agencies strictly handle cases on the stock market and individual corporate bonds.

Therefore, the Vietnamese stock market’s sharp decline was also partly similar to the general decline of the world, such as during a sharp drop (more than 68 points) on April 25, major markets in the world also fell. very deep point.

Besides, the correcting pressure after a long uptrend and the cautious sentiment in the market before single incidents caused the market to fluctuate strongly in the downward direction.

Actions are needed to “cleanse and clear”

Regarding drastic actions to purge and strictly handle violations in the individual stock and corporate bond markets, Minister Ho Duc Phuc said that the goal of the management agency is to build and develop The stock market is safe, transparent and sustainable, so cleaning the market will contribute to ensuring the interests of businesses and genuine investors, increasing the attractiveness of the stock market in attracting more capital flows. both domestic and foreign investment, contributing to support the process of upgrading from marginal to emerging.

“The resolute handling of violations may affect investor sentiment in the short term, causing the market to slow down, but it is an effort to make the market grow more transparent and sustainable. In the development process, changes are always needed, steps are needed to improve, and so is the stock market, we think that, after the development stages, it is also necessary to take actions to “cleanse and clear up””, the Ministry of Finance said. chief emphasized.

According to the Finance Commander, Vietnam’s stock market still has positive supporting factors from the macro-economy and the internal market. Therefore, we fully believe in the future, Vietnam stock market will develop more and more complete and better quality, affirming its role as the main medium and long-term capital mobilization channel of the economy. , enterprise; At the same time, it is an attractive, safe and effective investment channel for investors.

Solutions to protect the interests of investors and the market

Minister Ho Duc Phuc said that compared to the history of many developed stock markets in the world, Vietnam’s stock market is still young. However, Vietnamese securities have had a very fast and strong development and there is still a lot of room for development, with the goal of becoming the main medium and long-term capital attraction channel, important for the national finance and the country’s economy.

However, in order to realize that goal, according to the Minister, besides many solutions to support and promote the stable and sustainable development of the market, the Ministry of Finance will have solutions to prevent, ie “pre-room, post-inspection”, to protect the interests of investors, as well as companies operating in the market in the most equal, transparent and correct manner.

Accordingly, in terms of the legal framework, the Ministry of Finance will continue to perfect the legal framework to strengthen and tighten conditions for the healthy development of the market, like “building roads but adding new measures to the development of the market. regulations to prevent accidents.

The Ministry of Finance has proposed to the Government to amend the Law on Securities; At the same time, it also proposes to amend the Enterprise Law and other relevant regulations to create better conditions for development, closer to the reality and needs of the stock market.

At the same time, soon complete the formulation of a stock market development strategy to 2030 to shape goals, solutions and a long-term roadmap for stock market development. With regard to the corporate bond market, we have now completed the revision of the provisions of Decree 153/2020/ND-CP and are submitting it to the Government for consideration and promulgation.

Regarding the operation and management, the Ministry of Finance has also directed the State Securities Commission, the Department of Finance and Banking, the Department of Management, Accounting Supervision, Auditing and other functional units to implement the same A set of solutions in the direction of both supporting and creating conditions for the market to develop stably, while strengthening supervision, inspection, examination and strict handling of violations to increase market discipline and discipline.

As for the operation of the stock market, the Ministry has also directed to continue restructuring securities companies and fund management companies to review, classify, check on the spot, develop plans for each company to take handling measures; continue to develop and diversify investment fund types in order to improve the quality of investment demand, towards sustainable investment demand.

Along with that, implementing solutions to ensure a smooth transaction system, minimizing transaction congestion; complete the project of information technology modernization; Researching the legal framework for the development of new services and products on the Vietnamese stock market.

Regarding the corporate bond market, in addition to perfecting the law, the Ministry has directed functional units to strengthen supervision, inspection and correction of violations. The State Securities Commission will inspect and correct securities trading organizations, especially in the matter of violations and circumvention of regulations on professional securities investors.

“We also directed the Department of Management, Accounting Supervision and Auditing to apply both direct and indirect measures. Accordingly, we will directly examine the audited financial statements at the issuers. At the same time, it also re-examines the auditing companies that have audited those enterprises. If violations are found, strictly handle the irresponsible independent audit units to cause errors,” Minister Ho said. Duc Phuc information.

In addition, the Ministry of Finance also directed units to further strengthen training to equip investors with financial knowledge; strengthen propaganda so that investors and businesses can understand the legal regulations, opportunities and risks for effective investment in both the stock market and corporate bonds.