Vietnam’s stock market Asia’s strongest so far this year

Ho Chi Minh City Stock Exchange

Vietnam’s stock market has evolved into Asia’s strongest this year, with the country’s benchmark VN-Index surging more than 20 per cent in the first five months of 2021 – the highest among major benchmark indexes in Asia and among the highest in the world.

The growth was mainly driven by an influx of new foreign investors, exceeding those from South Korea and Taiwan that grew at more than ten per cent in the first five months.

One of the reasons why Vietnam’s stock market has surged in the past five months is that the government has continued to maintain a monetary easing policy, which means banks have kept their deposit rates low, VnExpress International cited Nguyen The Minh, director of analysis at brokerage Yuanta Vietnam.

Number of new treading accounts surges

The low return on deposits prompted people to look for more promising investment channels, and they have zeroed in on the stock market. The number of new domestic individual trading accounts opened last month tripled year-on-year to 110,000.

With trading volume having more than quadrupled since the end of 2019 and 11 stocks exceeding $5 billion in market value, up from two in 2015, Vietnam is now considered an “investable market,” according to HSBC analysts.

They and others cite solid economic prospects, relatively attractive valuations, rising foreign-direct investment flows and healthy earnings growth as reasons to be optimistic, while also showing faith in the government’s ability to contain the pandemic.

Trading overload amid “excessive” liquidity

The strong trading activity has, however, also led to problems. In the recent days, attention was focused on the Ho Chi Minh Stock Exchange’s trading overload that has caused temporary shutdowns. The bourse explained that its platform was paralysed after sudden “excessive” liquidity, leaving thousands of investors unable to trade.

A number of securities companies have announced their temporary suspension in response. Overloading issues have been subject of controversy for much of the year, with the blame being attributed to poor management and an age-old technology at the exchange.

The bourse promised to iron out the technical issues as soon as possible, noting that the trading congestion did not deter investors.



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Ho Chi Minh City Stock Exchange Vietnam’s stock market has evolved into Asia’s strongest this year, with the country’s benchmark VN-Index surging more than 20 per cent in the first five months of 2021 – the highest among major benchmark indexes in Asia and among the highest in the world. The growth was mainly driven by an influx of new foreign investors, exceeding those from South Korea and Taiwan that grew at more than ten per cent in the first five months. One of the reasons why Vietnam’s stock market has surged in the past five months is that the...

Ho Chi Minh City Stock Exchange

Vietnam’s stock market has evolved into Asia’s strongest this year, with the country’s benchmark VN-Index surging more than 20 per cent in the first five months of 2021 – the highest among major benchmark indexes in Asia and among the highest in the world.

The growth was mainly driven by an influx of new foreign investors, exceeding those from South Korea and Taiwan that grew at more than ten per cent in the first five months.

One of the reasons why Vietnam’s stock market has surged in the past five months is that the government has continued to maintain a monetary easing policy, which means banks have kept their deposit rates low, VnExpress International cited Nguyen The Minh, director of analysis at brokerage Yuanta Vietnam.

Number of new treading accounts surges

The low return on deposits prompted people to look for more promising investment channels, and they have zeroed in on the stock market. The number of new domestic individual trading accounts opened last month tripled year-on-year to 110,000.

With trading volume having more than quadrupled since the end of 2019 and 11 stocks exceeding $5 billion in market value, up from two in 2015, Vietnam is now considered an “investable market,” according to HSBC analysts.

They and others cite solid economic prospects, relatively attractive valuations, rising foreign-direct investment flows and healthy earnings growth as reasons to be optimistic, while also showing faith in the government’s ability to contain the pandemic.

Trading overload amid “excessive” liquidity

The strong trading activity has, however, also led to problems. In the recent days, attention was focused on the Ho Chi Minh Stock Exchange’s trading overload that has caused temporary shutdowns. The bourse explained that its platform was paralysed after sudden “excessive” liquidity, leaving thousands of investors unable to trade.

A number of securities companies have announced their temporary suspension in response. Overloading issues have been subject of controversy for much of the year, with the blame being attributed to poor management and an age-old technology at the exchange.

The bourse promised to iron out the technical issues as soon as possible, noting that the trading congestion did not deter investors.



Support ASEAN news

Investvine has been a consistent voice in ASEAN news for more than a decade. From breaking news to exclusive interviews with key ASEAN leaders, we have brought you factual and engaging reports – the stories that matter, free of charge.

Like many news organisations, we are striving to survive in an age of reduced advertising and biased journalism. Our mission is to rise above today’s challenges and chart tomorrow’s world with clear, dependable reporting.

Support us now with a donation of your choosing. Your contribution will help us shine a light on important ASEAN stories, reach more people and lift the manifold voices of this dynamic, influential region.

$
Personal Info

Donation Total: $10.00

 

 

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