Vietnam joins FTSE Russell emerging market benchmark
The index provider estimates the inclusion could redirect up to US$6 billion into the country
Vietnam has added its stocks to FTSE Russell's emerging market indices, marking a significant milestone for the nation's stock market. The inclusion, announced on September 21, is expected to redirect up to US$6 billion into Vietnamese equities following years of reforms aimed at attracting foreign investors. The benchmark index for Vietnam rose 0.54 percent on Monday, driven by banks, before experiencing a slight pullback.
The upgrade has reignited foreign interest in Vietnamese stocks, with overseas investors purchasing a net 2.7 trillion dong (US$104 million) worth of shares the previous week. However, overall investor sentiment is likely to remain subdued until 2027, according to Thomas Nguyen, chief global markets officer at SSI Securities Corporation.
The transition to full inclusion will occur in four stages through 2027, with 10 percent of stocks added in September, followed by larger allocations in March, June, and September of that year. Despite this progress, concerns remain regarding foreign ownership limits and free-float constraints for certain companies. The introduction of a central counterparty clearing mechanism, expected in 2027, could help Vietnam meet MSCI's market-access requirements, potentially leading to a future upgrade by MSCI.
Written by urgent.news from The Business Times - Companies & Markets's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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- Vietnam joins FTSE Russell emerging market benchmark bangkokpost.com
