Vice Chairman of the State Securities Commission Pham Hong Son has just had an exchange with the press around the issue of order blocking on the Ho Chi Minh City Stock Exchange (HOSE) of the regulatory agency and made the following recommendations: comment on future stock market movements.
According to Vice Chairman of the State Securities Commission Pham Hong Son, the situation of blocking orders on HOSE has occurred since the end of 2020 and is still an important issue of special concern to the whole industry.
With many urgent solutions implemented such as increasing the lot from 10 to 100, voluntary trading, stopping trading of newly listed shares on HOSE and especially technical improvement… has helped the system operate quite well. stable in recent times.
However, in the sessions at the end of May and the beginning of June, when the liquidity and the volume of orders on the market increased dramatically, the phenomenon of order blocking recurred, even posing a great risk to the HOSE trading system. , forcing HOSE to actively stop trading on the afternoon of June 1 to ensure the safety of the whole system.
Up to now, the system has returned to normal operation, with good progress as HOSE and members of the securities company make efforts to come up with new solutions.
In parallel with the current system, HOSE and related units have also actively deployed a transaction system in collaboration with FPT Corporation (FPT) and an information technology system for the entire KRX market. . All work is still carried out expeditiously, ensuring the schedule and schedule. The FPT coordination system has entered the phase of large-scale testing to handle the problem of command congestion.
According to Mr. Pham Hong Son, from now until the system in cooperation with FPT goes into operation, ensuring that HOSE’s current system of uninterrupted transactions remains the top priority. This is a matter of special concern to the Ministry of Finance and Minister Ho Duc Phuc has also given drastic instructions.
Under the direct direction of the Working Group to completely deal with the blocking of orders, the relevant units met to both conduct a review and propose urgent solutions that will be applied when necessary, in order to ensure the best possible for HOSE’s current trading system.
To ensure the stable operation of the market in the coming time, on the part of the management agency, the State Securities Commission organizes propaganda and training for market members on the new Securities Law 2019 and other legal documents. guiding and completing the legal framework for the stock market, developing a strategy for developing the stock market in the 2021-2030 period, continuing to restructure the stock market according to Decision No. 252/QD-TTg dated March 1, 2012 of the Prime Minister.
The State Securities Commission also strengthens supervision, inspection and inspection of market activities, requiring market members to comply with legal regulations. The State Securities Commission will strictly handle violations so that the securities market develops in a transparent and sustainable manner.
In addition, the State Securities Commission continues to drastically implement solutions to ensure a smooth trading system, and at the same time, must put the system built by FPT into use at the end of June or early in the year. This July, in order to completely solve the congestion problem at HOSE.
As for investors, a representative of the State Securities Commission suggested that the investor community should increase the level of caution, especially risk management when choosing investment portfolios.
Vice Chairman of the State Securities Commission Pham Hong Son said that the growth of the stock market is a signal that shows the role of medium and long-term capital mobilization and is a “test chart” of the Vietnamese economy. general and the attractiveness and potential of the stock market in particular.
However, the fact that the stock market has maintained a strong and long uptrend as in the past time has been posing more challenges and pressures for both regulators and market members. The most important regulatory agency in the current context is not only the growth rate of the market, but more importantly, maintaining the stability and sustainability of the market.
Therefore, besides the positive points, the stock market is also facing many difficulties and challenges, requiring identification to come up with appropriate solutions.
Accordingly, Vietnam’s stock market in the coming time will still face great risks. In particular, the prolonged global COVID-19 pandemic will remain the greatest risk.
Therefore, the movement of the stock market in the medium and long term depends on the ability to control the epidemic in the world and in Vietnam as well as the level of recovery of the domestic and international economy. In addition, the high stock price level also creates risks when the market corrects.
According to Vice Chairman of the State Securities Commission Pham Hong Son, the liquidity of the Vietnamese stock market has continuously set a record in recent years. Up to this point, it will not be too surprising with billion USD liquidity sessions.
Money flows into the stock market through many different channels and mainly comes from domestic investors.
Expectations of macroeconomic growth, effective epidemic prevention and control, low interest rates, many less attractive investment channels… are the main reasons for cash flow to the stock market at this time. past time. Margin cash flow (margin trading) into the stock market also increased.
As of May 31, 2021, the margin balance of the whole market has reached VND 112.1 trillion, an increase of VND 31.2 trillion compared to the end of 2020 and an increase of VND 10.7 trillion compared to the end of the quarter. January 2021. Some securities companies have shown signs of margin lending reaching the ceiling.
Regarding this, a representative of the State Securities Commission said that the market grew strongly, so the increase in margin balance was also understandable. Many securities companies have also been proactive and are implementing plans to increase charter capital, issue capital to increase capital to have sources to serve lending needs in the future.
According to Mr. Pham Hong Son, although the margin loan balance is still under control, however, the continuous increase in this number and is expected to increase further needs to be enhanced inspection and supervision to ensure the lending margin is legal, safe for securities companies and sustainable safe for cash flow in the stock market.
On May 28, 2021, the State Securities Commission also sent a document to securities companies to review and consolidate operations in the context of the COVID-19 epidemic. Accordingly, the regulator requires securities companies to comply with regulations on epidemic prevention and control, strengthen information technology, work online, take the initiative in business plans to ensure the provision of information services. transparent in all situations.
In particular, in this document, the State Securities Commission has required securities companies to absolutely “obey the law,” fully comply with the provisions of the securities law and relevant laws. mandarin.
In the coming time, the State Securities Commission will strengthen remote supervision, inspection and direct inspection; which will include capital mobilization, margin lending, as well as ensuring the safety of financial indicators of securities companies. In case of detecting violations, the management agency will handle strictly, ensuring discipline and market discipline.
Source: Vietnam News Agency