Nasdaq sees growing potential in Việt Nam's stock market

Nasdaq sees growing potential in Việt Nam's stock market

Việt Nam is a dynamic market with considerable potential to continue attracting interest from US investors as well as global investors, said Nasdaq Vice Chairman Robert H. McCooey Jr.

The Vietnamese and US delegations at the meeting in New York. — Photo courtesy of SSC

Việt Nam is seeking to attract greater international investor participation following its upgrade to FTSE Russell's Secondary Emerging Market status, as regulators step up cooperation with Nasdaq.

State Securities Commission (SSC) Chairwoman Vũ Thị Chân Phương met Nasdaq Vice Chairman Robert H. McCooey Jr. in New York on August 26 (local time), as part of her working visit to the US.

At the meeting, Phương outlined recent developments in Việt Nam's stock market, including reforms to its legal framework, operating mechanisms and market infrastructure aimed at improving transparency, efficiency and accessibility for international investors.

"The upgrade of Việt Nam's stock market by FTSE Russell from Frontier to Secondary Emerging Market opens up new opportunities to attract capital and greater participation from international investors," Phương said.

She added that the upgrade was also expected to encourage US investors to pay greater attention to and participate more actively in Việt Nam's securities market.

The country will continue improving market quality, diversifying products and strengthening regulatory and supervisory effectiveness, while facilitating greater participation by both domestic and international investors, she said.

McCooey welcomed the progress made by Việt Nam's stock market and congratulated the country on its market upgrade.

"Việt Nam is a dynamic market with considerable potential to continue attracting interest from US investors as well as global investors," he said, adding that Nasdaq was ready to continue working with the SSC and Việt Nam's stock market during its new stage of development.

A key focus of the discussions was strengthening connectivity between the Vietnamese and US capital markets.

The two sides explored ways to connect Vietnamese companies with financial institutions, investment banks and international investors. 

Nasdaq said it was prepared to leverage its network and experience to facilitate corporate connections, introduce investment opportunities and help Vietnamese companies explore suitable fundraising methods in international capital markets.

They also exchanged experience in developing new products and market segments, in line with Việt Nam's efforts to diversify financial products, broaden corporate funding channels and deepen its capital market.

Market surveillance was another area identified for greater cooperation. 

Phương proposed that Nasdaq increase experience-sharing, training and professional exchanges to strengthen the capabilities of Việt Nam's market surveillance personnel.

Nasdaq said it was willing to coordinate with the SSC on training, professional exchanges and experience-sharing programmes through both in-person and online formats.

The discussions come as Việt Nam's FTSE upgrade is expected to reshape the market's foreign investment landscape.

Vũ Minh Đức, deputy director of Research and Analysis at Vietcap Securities, said the upgrade was positive for Việt Nam's stock market from a medium- to long-term perspective, as its new status could attract fresh foreign capital through both passive and active investment channels.

In the initial phase, exchange-traded funds tracking the FTSE Global Equity Index Series are expected to channel about US$150 million into Vietnamese equities.

Đức said the inflow could provide some support to the market, particularly at a time when foreign investors continue to record net selling.

However, he noted that the FTSE-related inflows alone would not necessarily be sufficient to generate a sustained medium-term rally.

The market would still need additional catalysts to draw more domestic capital, he said. 

At current valuation levels, different sectors could offer opportunities if overall market liquidity improves, although large-cap stocks representing major industries may attract greater investor attention than mid- and small-cap shares at this stage.

Meanwhile, relatively attractive interest rates could compete with equities for domestic capital, as bank deposits continue to offer investors a safer investment option. 

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