How did the stock market react after Vietnam's upgrade?

(NLDO) - Vietnam's stock market has officially been upgraded to an emerging market. What stock investment strategies do investors need at the end of the year?

Early morning on October 8, market rating organization FTSE Russell announced that Vietnam's stock market had met all official criteria and was upgraded from a frontier market to a secondary emerging market.

Accordingly, the expected effective date is from September 21, 2026, after FTSE Russell conducts a mid-term review in March 2026.

Billions of dollars are estimated to flow into the market after Vietnam's stock market is upgraded.

ACBS Securities Company believes that this is positive news for the market after many years of waiting. After being upgraded to FTSE's secondary emerging market, the market can attract 2 capital flows: Passive capital flows automatically allocated on the effective date. Global ETFs such as FTSE Emerging Markets ETF, iShares Core MSCIEM ETF, or Vanguard FTSE EM ETF will automatically allocate to Vietnam according to the proportion in the emerging market basket.

According to ACBS, the estimate is from 600 million USD to 1.5 billion USD, of which the largest is Vanguard FTSE Emerging Markets ETF - the largest fund currently trading according to the FTSE Emerging Index - managing about 100 billion USD.

Which stocks benefit directly?

With an allocation rate of about 0.6% for the Vietnamese market, the capital flow from Vanguard could reach up to 600 million USD. If the entire passive fund according to FTSE EM and FTSE Asia is counted, this figure could reach up to 1.5 billion USD.

However, the effective date for the Vietnamese market to be officially included in the ETF is September 2026, which is nearly 1 year away.

"Stocks that directly benefit are large-cap stocks (bluechips) with large foreign room and high liquidity such as VCB, VHM, VNM, HPG, STB,FPT , SSI... After the upgrade, Vietnam was put on the list of interest of hundreds of active investment funds, with criteria for investing in emerging markets. The preferred taste of active investment funds is often banking stocks, retail consumption, infrastructure, technology..." - ACBS expert said.

According to analysis by Maybank Securities Company, after being upgraded to emerging market status by FTSE, Vietnam could receive about 700 million USD - 1.1 billion USD in capital flows from ETFs tracking FTSE's emerging indices (depending on the potential proportion allocated to the Vietnamese market). It is estimated that the main stocks that benefit from FTSE upgrading the Vietnamese stock market will be VIC and VHM, with capital flows of nearly 400 million USD.

"Thanks to the increase in market capitalization of many stocks over the past year and the expansion of foreign room for some stocks, the number of Vietnamese stocks eligible to participate in FTSE's emerging indices has increased from 6 to 9 codes. For example, FPT has now become an eligible name thanks to the expansion of foreign room; LPB and STB also entered the list thanks to the increase in market capitalization" - Maybank Securities stated.

Long-term prospects after stock upgrade

According to experts, after the stock upgrade, capital flows from active investment funds could be from 3-7 billion USD. This is a difficult figure to estimate because it depends on the investment needs of each period of the funds, many of which are already present in Vietnam.

However, research from FTSE and the World Bank (WB) also forecast that, in case of upgrading, active capital flow into Vietnam could reach up to 7 billion USD, the absorption time will last from 3-5 years.

In the long term, according to Dragon Capital Securities Company (VDSC), FTSE Russell is one of the world's leading providers of reference indices, analysis and data solutions for global investors.

Being recognized by this organization for upgrading its ranking will contribute to making Vietnam's "national financial brand" more prestigious in the eyes of the international market. Thereby, strengthening the confidence of foreign investors, especially from developed countries, when looking for investment opportunities in Vietnam.

Source: https://nld.com.vn/thi-truong-chung-khoan-phan-ung-the-nao-sau-khi-viet-nam-nang-hang-196251008083005315.htm