Vietnam’s stock market posts highest gain in Asia

Driven by an improving economy and foreign investment giants, Vietnam’s stock exchange has outperformed the rest of Asia so far this year.

The benchmark VN-Index has risen around 17 percent since January, outpacing Asia’s main share benchmarks, and the market has more than doubled over the past two years, the Financial Times reported on Wednesday.

The VN-Index, a capitalization-weighted index of all the companies listed on the Ho Chi Minh City Stock Exchange, closed at 1,150 on Tuesday.

Vietnam has become a fertile land for foreign investors, the Financial Times cited analysts as saying.

Foreign firms that have set up factories in Vietnam over the past decade are now contributing to its improved trade balance, including Intel and Samsung, they said, adding that Vietnam's bright economic prospects have contributed to the stock market's success.

Vietnam’s economy grew 7.38 percent in the first quarter of this year, the highest rate in a decade thanks to industry and construction.

The VN-Index closed at 1,120 on February 28, up a staggering 14 percent from the beginning of the year, which was the biggest gain worldwide.

The index currently stands at 70 percent higher than in January 2017, making the Vietnamese stock market one of the world’s best performing and most attractive.

Vietnam’s stock market has been upbeat since the second half of last year.

It closed at a 10-year high of 984.24 on the last working day of 2017, earning Vietnam the nickname Asia’s “frontier market” with a 47 percent gain.

Nguyen The Minh, a senior analyst at Saigon Securities Incorporation, said the VN-Index could reach 1,300 by the year-end, while RongViet Securities Corporation in Saigon said it could finish as high as 1,640.

Vietnam’s economy grew 6.8 percent in 2017, breaking its own 6.7 percent target which both government officials and economists had considered ambitious.

The Asian Development Bank thinks that Vietnam’s economy will expand by 7.1 percent this year, which if true would be the highest growth rate recorded by the country since 2008.

The country's Ministry of Planning and Investment has forecast two scenarios for economic growth this year.

The rate will either be 6.7 percent as targeted by the legislative National Assembly, or 6.8 percent if the manufacturing and processing industry continues to thrive for the rest of the year.