Bloomberg comments on opportunities after Vietnam's stock market upgrade

Early morning on October 8, FTSE Russell announced the upgrading of Vietnam's stock market from a frontier market to a secondary emerging market. Bloomberg (USA) assessed that with this development, Vietnam's stocks will be grouped with the region's leading economic markets such as China and India.

Customers transact at Bao Viet Securities Company's headquarters in Hanoi . Photo: Tran Viet - VNA

The upgrade will take effect on September 21, 2026, following a mid-term review in March 2026. Vietnam was previously added to the watch list in September 2018.

According to Bloomberg, market classification helps decide the destination of trillions of dollars of capital from global investors. When a country is upgraded, fund managers - who allocate capital based on the index - can increase their investment proportion, often leading to large and stable long-term foreign capital flows into the market.

According to Bloomberg, Vietnam is one of the countries benefiting from the trend of diversifying global supply chains, attracting strong investment flows.

Thanks to a young population and strong domestic purchasing power, Vietnam’s growth momentum continues to consolidate. Economists forecast Vietnam’s GDP will increase by more than 6.9% this year and maintain above 6%/year for the next two years – far exceeding the regional average.

Analysts at Swiss bank Julius Baer argue that while the FTSE upgrade is unlikely to have an immediate impact on Vietnam's economy, it is an important milestone that could act as a catalyst for more market-friendly reforms.

If foreign capital flows more strongly into the Vietnamese market after this change, the cost of capital mobilization for domestic enterprises could decrease significantly.

Investors monitor stock market developments at the HOSE floor. Photo: Hua Chung-VNA

For investors, a more accessible Vietnamese stock market would open up a “new growth zone” in Asia. Investment funds linked to the FTSE Russell emerging market index now manage hundreds of billions of dollars, and even a small change in the index could unlock billions of dollars in new capital flows.

FTSE Russell estimates the reclassification could bring up to $6 billion into Vietnam’s stock market, which had a total capitalization of about $350 billion as of October 7. Meanwhile, HSBC gave a more conservative figure of about $3.4 billion.

Being a secondary emerging market brings a certain prestige, but also exposes the economy to more intense competition from countries with larger and stronger foundations. Deeper integration into the international financial system also means facing stronger impacts from global market fluctuations than before.

Bloomberg noted that the mid-term review in March 2026 will be key in determining whether Vietnam has made enough progress to be upgraded.

Beyond FTSE Russell, attention will shift to whether Vietnam can continue to win an upgrade from MSCI – a move seen as a more important milestone, likely to attract stronger foreign capital flows.

Source: https://baotintuc.vn/kinh-te/bloomberg-nhan-dinh-ve-co-hoi-sau-khi-viet-nam-duoc-nang-hang-thi-truong-chung-khoan-20251008215940065.htm