VietNamNet Bridge – If the Government effectively implements its business rescue plan this year, the securities market will prosper, say market insiders.

Experts forecast the stock market will rebound this year following the implementation of the Government's business rescue plan.

"According to predictions by domestic and foreign financial institutions, Viet Nam's economy will be better in the second half of this year, and so will the stock market," Nguyen Doan Hung, vice chairman of the State Securities Commission, told the newspaper Tien Phong.

"If inflation continues to be controlled at a low rate, banks will likely extend credit at lower interest rates. If so, capital will move from the banking sector to other investment channels, including securities and real estate markets. However, the extent of capital movements will depend on the market's evolution."

Money flowing in the stock market increased substantially in the last trading sessions of 2012, a positive sign, the deputy director of a Ha Noi-based securities company said on the condition of anonymity.

"The Government plans to rescue the real estate market, and the State Bank of Viet Nam is also considering easing credit for loans of securities investments, which will help draw more capital into the market," he said.

He predicted the domestic economy would continue to see difficulties, but the announcement that a rescue package had been drafted, together with the decision to cut interest rates by one percentage point in the last days of 2012, raised investors' spirits.

The stock market promises to improve this year, particularly if the property market rescue package is passed, agreed an analyst from a HCM City-based investment fund.

"The package will help solve the high inventory problem that enterprises currently face, while facilitating capital flow in the economy, which will have a positive influence on the stock market," he said.

Source: VNS