Foreigners take profits as market rises to new peak, sell $2B worth of stocks

The figure has only been surpassed in 2021 and 2024, but in the full year, data from the main bourse Ho Chi Minh Stock Exchange shows. In August alone their net sales have been worth VND23.4 trillion.

A key portion has been made up by the divestment from conglomerate Vingroup by South Korean fund SK Investment.

Between August 4 and 8 SK offloaded over VND12 trillion worth of Vingroup shares through negotiated transactions.

The largest private company in Vietnam explained that this was part of SK’s previously announced global portfolio restructuring strategy.

SK said it was an opportune time to sell Vingroup shares as the stock had more than doubled in value since the beginning of the year.

FPT was the second most sold stock by foreign investors this month with net sales of VND4 trillion in the first half of August. VPBank was the most purchased stock, with foreign buyers investing VND742 billion in it.

Nguyen Anh Duc, director of institutional brokerage and investment advisory at SBB Securities, said the foreign investors’ selling followed substantial buying in July, amounting to nearly VND7 trillion, and was fueled partly by the U.S. imposing a 20% import tariff on Vietnamese goods.

Their profit-taking was intensified by the stock market shooting up by nearly 52% since early April.

So far this year the benchmark VN-Index has jumped nearly 30%, breaching the 1,600 level for the first time ever on August 12 and now hovering at 1,640 points.

Stocks in the foreigners’ favorite VN30 group, comprising the 30 largest capped stocks, such as SSI Securities Corporation, Vingroup, VPank and Techcombank have doubled in value since April.

Duc also said a lot of foreign capital has been flowing into other emerging markets with less pronounced gains such as Thailand and Taiwan.

The Thai stock market has declined by 10% since the start of the year, while Taiwan’s is up 4.9%.

Nevertheless, analysts remain optimistic about Vietnam’s potential to attract foreign capital following an imminent upgrade to its stock market.

It is currently classified as a "frontier market" by global index and rating provider FTSE Russell, and is on course for an upgrade to "emerging market" status.

Last month Minister of Finance Nguyen Van Thang had said Vietnam would soon meet FTSE Russell’s upgrade criteria. The upgrade is a key objective for the government.

Tran Hoang Son, director of market strategy at VPBank Securities, estimated capital inflows could be $3-7 billion once the upgrade takes effect. That would provide a substantial boost to the market, he added.

They include $1 billion in exchange traded funds, according to SSI Securities.