HÀ NỘI — Experts are sanguine about the health of the stock market in 2018 even as they acknowledge likely risks and imbalances.

Voicing her opinion at an online discussion yesterday, Phạm Minh Hương, Chairwoman of the Board at VNDIRECT Securities Corporation, said the stock market’s 2017 growth was spectacular but not surprising.

Her prediction for 2018 was that the finance, energy and manufacturing sectors will experience strong growth, which means they are likely to be recommended to both up-and-coming and experienced investors by financial experts.

Hương said that although the banking and finance sector would still face a lot of institutional and bad debt risks, commercial banks, securities and insurance companies have learned their lessons and are well prepared for the challenges to come.

With Việt Nam’s fast-growing consumer economy, the manufacturing and energy sectors will always be attractive. Aviation is another safe bet, as living standards and tourism increase, she said.

The year 2018 is set to mark the beginning of Việt Nam’s next stage of financial growth, with the Vietnamese stock market upgraded to emerging market status in late 2019 or early 2020.

Hương also expected the VNIndex to surpass its peak of 1,170 points in 2017, and she was backed by some experts who foresaw a very optimistic 2018 scenario of 1,500 to 1,700 points.

The 2017 stock market growth will continue to be supported by the world economic growth cycle, she added.

Lagging periods

In the same vein, prominent economist Võ Trí Thành said that his research shows Việt Nam’s stock market growth rate will continue at a high, although investors should expect lagging periods in 2018.

The world economy in general and the Vietnamese stock market in particular are likely to face some risks, as leading global stock markets go through adjustments in late 2018 and early 2019.

The Eurozone is highly unlikely to maintain its economic stimulus packages, and Chinese public debt continues to rise.

Income inequality in leading economies, trade protectionism, uncertainty about major trade and investment negotiations, housing bubbles, geo-political tensions and inflation rates will all begin to increase, Thành predicted.

Việt Nam’s 2018 economic forecast remains positive, but not at 2017 levels, he claimed.

The 2018 growth target approved by the National Assembly, of 6.5 to 6.7 per cent, shows a certain lowering of expectations and an increase in caution, compared to 2017, Thành said.

Besides global risks, the need to synchronise short-term growth and institutional restructuring should not be ignored, he said.

While agreeing with Thành and Hương, Trương Văn Phước, acting Chairman of the Việt Nam National Financial Supervision Council (NFSC), said that the push for a credit growth of over 20 per cent since the second quarter this year over concerns that GDP growth could fall short of the 2017 target was understandable, but the key issue was growth quality, not quantity.

At the moment, stock market investors are pouring capital into securities and real estate, forming an indirect growth channel for the Vietnamese economy, he said.

But Phước expressed concern over imbalances in the financial markets, especially the lack of harmony between the currency and capital markets.

He strongly advocated the establishment of a moderate-level financial market with accommodating and open policies.

Cryptocurrencies

Bang Hyun Woo, Samsung Vietnam’s Senior Vice President and Chief Relations Officer, shared his thoughts on cryptocurrencies, mainly bitcoin, which he considered to have both good and bad sides.

He believed that Vietnamese investors trading in bitcoin can have some impact on the exchange rates.

He advised investors to be very careful and to withdraw their investment in the coin investment at the earliest sign of the bubble bursting.

Jointly organised by the online news sites Trí Thức Trẻ and CafeF, yesterday’s discussion reviewed economic growth in 2017 and prospects for 2018 prospects, focusing in particular on investment opportunities, equitisation of major state-owned enterprises, and the future of cryptocurrency. —VNS