Vietnam's securities market upgraded

The decision was made by market rating organization FTSE Russell in its periodic classification report released early this morning, October 8.

Illustration photo.

"The FTSE Russell Index Management Board (IGB) recognises Vietnam's progress in improving its market and confirms that Vietnam meets all the criteria for secondary emerging market status," the announcement said.

The upgrade will officially take effect from September 21, 2026, but is subject to the outcome of a review in March 2026, according to FTSE Russell. The review will assess whether Vietnam has made sufficient progress in improving access to global investors.

IGB said it had considered the Market Classification Advisory Committee’s comments on restrictions on foreign investors trading in Vietnam. This is not a mandatory condition, but IGB said improving foreign access is essential to upgrading.

FTSE Russell said it will closely monitor developments and take feedback from stakeholders ahead of the March 2026 review to ensure the upgrade can take place half a year later. The detailed upgrade roadmap will be announced by the organization during the March 2026 review.

At the same time, FTSE Russell upgraded Greece from an advanced emerging market to a developed market. The decision also takes effect from September 21, 2026, and Greece does not need to undergo a further review early next year.

FTSE Russell is one of the three leading index providers in the world , alongside MSCI and S&P Dow Jones Indices. FTSE Russell's index products are widely used globally, with customers including fund management companies, financial institutions, banks and other investment organizations.

FTSE Russell classifies stock markets into four groups: developed, advanced emerging, secondary emerging, and frontier. It currently classifies 13 other markets as secondary emerging. Among them are many Asian countries such as China, India, Indonesia, the Philippines, and Qatar.

Upgrading from a frontier market to an emerging market according to FTSE Russell criteria this year is the goal mentioned by the Government in the Project to Upgrade the Vietnamese Stock Market approved a month ago. In the long term, by 2030, Vietnam strives to achieve MSCI's "emerging market" criteria and FTSE Russell's "advanced emerging market" criteria.

Prior to this assessment, Vietnam had not met the criteria related to payment cycles and transaction processing costs. Since last year, the Ministry of Finance and relevant agencies have implemented a series of solutions to remove barriers.

Many new documents have been issued to create equal market access conditions for foreign investors. Typically, Circular 68 to eliminate the requirement for foreign investment organizations to deposit funds before transactions or Circular 03 to simplify account opening procedures for foreign investors.

Since early May, the market operator has also operated a new information technology system to meet the needs of foreign investment funds, creating a platform to deploy the central clearing counterparty (CCP) mechanism for the underlying market and develop new products and services according to international standards.

The upgrade will help the stock market attract large-scale international capital flows. Some domestic securities companies estimate that there will be about 6-8 billion USD of foreign capital poured into Vietnam. HSBC Global Investment Research believes that in the most optimistic scenario, the figure could be up to 10.4 billion USD. The estimates include capital from both active and passive funds. However, the actual capital flows will be allocated in stages because FTSE announces the change of market classification many months in advance.

The upgrade information, according to many analysis groups, is an important driving force supporting the growth of VN-Index in the final months of the year. The index is currently at 1,685 points, up nearly 420 points (equivalent to 33%) compared to the beginning of the year, but still about 26 points below the historical peak.

According to VnExpress

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Source: https://baobacninhtv.vn/chung-khoan-viet-nam-duoc-nang-hang-postid428332.bbg