Vietnam joins FTSE Russell emerging market benchmark
FTSE Russell estimates the move could redirect up to $6 billion into Vietnam and revive hopes of a future MSCI upgrade.
- On Monday, FTSE Russell added Vietnamese stocks to its emerging market indices, marking a milestone after years of reforms aimed at attracting foreign investors. The index provider estimates the inclusion could redirect up to $6 billion into Vietnam.
- Vietnam has been on the FTSE Russell watchlist since 2018 for entry into an emerging market category that also includes China and India. The watchlist placement reflects broader reforms designed to attract foreign investors.
- Vietnamese benchmark indices opened up 0.54% on Monday before retreating slightly, while asset management firm Vanguard plans to boost investment in Vietnam to about $2.5 billion over the next few years.
- The transition will take place in four stages through 2027, with 10% added in September, 20% in March, and 35% each in June and September of next year. A central counterparty clearing mechanism remains crucial for a future MSCI upgrade.
- Thomas Nguyen, chief global markets officer at SSI Securities Corporation, expects the market to remain relatively subdued until the next inclusion tranche in March, when attention should pick up alongside the larger allocation.
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Global index manager FTSE Russell has added stocks from the Vietnamese stock exchange to its emerging market index.
After nearly a decade of pursuing an upgrade, Vietnam's stock market officially entered the secondary emerging market group today (September 21). "The upgrade of the Vietnamese stock market is the result of persistent reforms." The FTSE Russell upgrade is the beginning; maintaining the upgrade depends on the internal workings of the businesses. FTSE Russell proposes a roadmap for collaborative product development and risk management.
HNX Index Today: Index Rises 0.51% Higher to 275.29 in Opening Session As Investors Track Global Markets and Economic Risks | What Investors Should Watch
The HNX Index in Vietnam’s Hanoi opened 0.51% higher at 275.29 points this morning marking a modestly positive start to the trading session for September 21. The modest opening gains indicate a slightly optimistic beginning as investors monitor market mood and the current geopolitical tensions in the US. It comes after Vietnam’s stock market officially joined the emerging market benchmarks by FTSE Russell.
Vietnamese stocks were officially upgraded by FTSE today (September 21), raising expectations of larger international capital inflows. Following the upgrade, the VN-Index will need to find further momentum to maintain its upward trend.
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