Vietnam stock market listed among best performers in Asia this year

By VnExpress   October 3, 2016 | 02:04 pm GMT+7
Vietnam stock market listed among best performers in Asia this year
Investors sit watching share prices at an Asia Commercial Bank (ACB)’s securities trading floor in Hanoi, Vietnam. Photo by AFP/ Hoang Dinh Nam

The benchmark VN Index was the second fastest growing in Asia in the first nine months.

Despite low global growth, Vietnam’s economy is widely seen as among the most resilient in Asia. Even with the unprecedented Brexit vote, there appears to have been no serious impact on the country’s economy.

Vietnam’s benchmark VN Index, ranked second only to Pakistan in Asia, has gained 18.91 percent so far this year, data shows.

"Vietnam remains one of the bright spots in Asia," CNBC quoted Vishnu Varathan, senior economist at Mizuho Bank, as saying.

The economist said that foreign investors have been lured to Vietnam because they want to tap into the country’s low-cost manufacturing base.

Many companies have moved their factories away from China, where labor is becoming more expensive and there are geopolitical risks.

Other investors are interested in reaping benefits from the fact that Vietnam is becoming more open through a variety of new-generation free trade agreements.

However, Varathan added, the country needed to make its banking sector stronger.

Vietnam will launch a major stock index on October 24 that will comprise 388 companies listed on the country’s two bourses, ThomsonReuters cited a statement released by the stock exchanges on Friday.

The new VNX Allshare index will comprise 208 companies' shares from the Ho Chi Minh Stock Exchange and 180 from the Hanoi Stock Exchange, the statement said. The companies must meet certain standards including liquidity and free-float rate.

The aim is to increase the transparency, trust and attractiveness of Vietnamese shares for investors, especially foreigners, the statement added.

Foreign investors have accounted for around 15 percent of total trading value on the Ho Chi Minh Stock Exchange so far this year, up slightly from 2015, official data showed.

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