Latest news with #HoChiMinhStockExchange
The Star
4 days ago
- Business
- The Star
Vietnam stock market starts June with modest gain
The VN-Index recovered the 1,335-point mark despite early pressure from large-cap declines. — VNA/VNS HANOI: Vietnam's stock market started June on a positive note, with a modest gain on Monday, primarily driven by small and mid-cap stocks. The VN-Index recovered the 1,335-point mark despite early pressure from large-cap declines, while liquidity eased slightly and foreign investors continued to sell, albeit at a reduced pace. Early on, the market experienced downward pressure from a number of large-cap stocks, briefly pulling the VN-Index below 1,325 points. However, continued cash inflows into small and mid-cap shares helped the rebound to end higher. By the close of trading, the VN-Index rose 3.7 points, or 0.28%, to 1,336.3 points on the Ho Chi Minh Stock Exchange. Market breadth leaned towards the gainers, with 201 stocks advancing and 125 declining. Liquidity fell by 6.7% from the previous session to 0.8 trillion dong. The VN30-Index, which tracks the 30 largest listed companies by market capitalisation, edged down 0.64 points, or 0.04%, to 1,423.04. Within the basket, 16 stocks gained, 13 declined and one remained unchanged. Leading the market's upward momentum was Vietnam Rubber Group – Joint Stock Co, which climbed 2.09% and contributed over 0.6 points to the VN-Index. It was followed by gains in two banking stocks: Techcombank, up 1.31%, and Sacombank, which rose 2.7%. On the other hand, several major stocks posted losses and that weighed on the index. The Vingroup cluster led the decliners, collectively dragging the VN-Index down by nearly five points, with VIC being the most notable, slipping 0.41%. Analysts from Viet Dragon Securities said: 'The market continued to face resistance at the 1,345-point level and retreated. 'Liquidity declined slightly compared to the previous session, suggesting reduced profit-taking activity and easing selling pressure, particularly as foreign outflows moderated. — Viet Nam News/ANN
Business Times
05-05-2025
- Business
- Business Times
Vietnam launches long-awaited new trading system, moves closer to market upgrade
[HANOI] Vietnam's Ho Chi Minh Stock Exchange (HoSE), on Monday (May 5), officially rolled out the most comprehensive infrastructure overhaul to date. This will serve as a foundational step for it to align with international standards and unlock a potential equity-market upgrade to emerging status this year. The new system, known as KRX, has been under development via a partnership between HoSE and Korea Exchange since 2012. It is expected to address earlier technical challenges, such as order congestion, as well as enable a wide range of advanced features aimed at shortening the settlement cycle and increasing trading capacity, according to an earlier statement from the State Securities Commission. The upgraded platform launched on Monday has enabled new trading practices, including changes in negotiated and odd-lot transactions, order amendment, derivative contract symbols, trading of securities under restriction, foreign room, as well as margin-value control time. However, full functionalities will be activated gradually in phases. Some key features are expected to be introduced next year, including the same-day trading (T+0) and central clearing counterparty (CCP) mechanisms, which are crucial to reduce settlement complexity as well as the time and costs associated with accessing funds and securities. KRX is also designed to facilitate more financial products and instruments in the near future, such as short-selling, algorithmic trading, and options contracts. In addition, it will integrate and develop comprehensive databases encompassing transactions, settlements, ownership, and risk analysis, thus aligning with international standards and enhancing its connectivity with global financial institutions. 'While the system's launch marks a significant step forward, its full operational impact will take time to materialise,' said Tyler Nguyen, chief market strategist at Ho Chi Minh City Securities Corporation (HSC). A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up Petri Deryng, portfolio manager at PYN Fund Management, believes that once KRX is fully operational, Vietnam's stock market could see its daily liquidity reach four to five times higher than the current level. The average daily trading value on the HoSE was about US$850 million in 2024, marking a nearly 20 per cent increase compared with that in 2023, with an end-of-year market capitalisation of listed stocks surpassing US$290 billion. This puts HoSE's liquidity on a par with that in Indonesia's and Malaysia's stock exchanges, which are classified as secondary emerging markets by global index provider FTSE. In a note to investors on Mar 24, Deryng stated that FTSE emphasised the importance of getting the new KRX trading system up and running in Vietnam, 'as its features create a path to other changes and are an important factor in the market status assessment'. Potential market upgrade in 2025 The London-headquartered index provider has included Vietnam in its watch list for a possible upgrade to emerging-market status since 2018. However, according to its interim report released on Apr 8, Vietnam fell short of meeting two criteria. The first one was 'Settlement Cycle (delivery versus payment)', which was rated as 'restricted' due to the current practice of a pre-trading check to ensure the availability of funds prior to executing trades. This prevents trade failures artificially, which leads to the unrated criterion of 'Settlement – costs associated with failed trades'. Last November, Vietnam's authorities addressed these impediments by removing the prefunding requirement. This had asked foreign institutional investors to deposit the entire funds before placing 'buy' orders, thus reducing capital efficiency and making the country less attractive compared with other markets. With the new rule in place, securities companies with sufficient capacity can place orders on behalf of these investors before the funds are fully transferred, as long as payment obligations are met by the settlement date. 'Given this development, FTSE Russell continues to monitor the market and seek feedback from market participants on the (non-prefunding) model and the management of failed trades,' the index provider added in the April report. Some brokers are already planning to offer T+0 settlement and a netting mechanism – which consolidates multiple transactions into a single net obligation – to top-tier institutional clients, such as exchange-traded funds (ETFs), which are major investors in the FTSE. According to market watchers, this early adoption could facilitate a smoother transition and accelerate the broader market upgrade. However, the current broker-led model places the credit and settlement risk on the brokers. The CCP, which is slated to be enabled by KRX in the coming year, could mitigate this systemic risk by becoming the legal counterparty to both sides of a trade, guaranteeing settlement even if one party defaults, thereby eliminating the need for prefunding. Foreign capital could play bigger role As technical barriers are lifted, HSC's Nguyen believes that foreign capital, particularly from ETFs tracking indices such as MSCI Emerging Markets or FTSE Emerging Markets, is likely to play a larger role in Vietnam's equity market. 'The anticipated initial inflows of US$3 billion to US$4 billion from a potential FTSE upgrade represent only the beginning; greater allocations are likely to follow as Vietnam further integrates into the global financial system,' he noted. The World Bank forecast that the stock-market upgrade could bring up to US$25 billion in new investments from international investors to Vietnam by 2030. However, short-term and medium-term prospects remain uncertain, especially after US President Donald Trump hit Vietnam with one of Asia's highest reciprocal tariffs of 46 per cent on Apr 2. The benchmark VN Index then showed heightened volatility and dropped a sharp 17 per cent on Apr 9. It was down 6.2 per cent on a monthly basis as at the end of April, bringing the year-to-date performance from a gain of 4 per cent as at the end of March to a loss of 3.2 per cent as at May 2. The VN Index closed at 1,240.05 on May 5, up 1.1 per cent after the official launch of the KRX system, which coincided with the first trading day after a five-day-long holiday. 'In the interim, we expect positive sentiment around the roll-out to benefit brokerage stocks,' Nguyen added. '(However,) trade-war tensions remain a key sentiment driver.'
Business Times
05-05-2025
- Business
- Business Times
Vietnam's main stock exchange launches long-awaited trading system
[HANOI] Vietnam's Ho Chi Minh Stock Exchange officially launched its new trading system on Monday (May 5), as the country pushes to unlock emerging market status and boost foreign investment. The new system, known as KRX from Korea Exchange, is expected to shorten the settlement cycle and increase trading capacity, according to an earlier statement from the State Securities Commission. 'The new system will establish the foundation for a central clearing counterparty system,' said Nguyen The Minh, head of research at Yuanta Securities Vietnam. Both the MSCI and FTSE indices currently classify Vietnam as a frontier market, which prevents many funds, family offices, and others from investing in companies listed there. FTSE will hold its next regular review in September. Vietnam has been on FTSE's watchlist for a possible upgrade since 2018. Vietnam's benchmark stock index rose slightly on Monday morning, reaching 1,232 as at 0243 GMT. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up Last November, Vietnam removed a requirement for overseas investors to fully prefund equity trades, one of the longstanding barriers to its potential upgrade. The KRX had faced multiple delays due to regulatory and technical roadblocks. 'KRX can enhance market liquidity and pave the way for the launch of other new financial products including day trading, short-selling and derivatives, which will better benefit investors,' Minh said. According to Minh, the system has been functioning properly so far, but it may take investors some time to get accustomed to it. REUTERS
Yahoo
04-04-2025
- Business
- Yahoo
Global markets greet Trump's tariffs with a worldwide sell-off
Global markets reacted to US President Donald Trump's massive tariffs with a worldwide sell-off, as investors worried about the economic effects and instability of the measures. The Dow Jones Industrial Average fell 3.98% to 40,545.93 points - the largest daily percentage loss in more than three years. Losses were even greater on the Nasdaq, which is dominated by major technology stocks. The Nasdaq 100 Index dropped 5.41% to 18,521.48 points. The S&P 500 fell 4.84% to 5,396.52 points, its worst daily drop since 2020, according to Dow Jones Market Data. New York losses preceded by ones in Frankfurt, Tokyo In Germany, the DAX fell to its lowest level since February. It was trading at 21,700.36, down 3.08% at the day's close. The MDAX of medium-sized companies fell by 2.44% to 26,824 points in early trading and was at 26,904.16 for a loss of 2.15% at the end of the trading day. The eurozone's leading index, the EuroStoxx 50, also lost more than 2% in early trading and was later 3.61% lower at the close. Stephen Dover, market strategist at Franklin Templeton, described the development as the end of the free trade era. He said Trump's tariffs were much higher than expected. In this environment, assets considered safe havens, such as gold and government bonds, were in demand. The tariff package is accompanied by concerns about economic growth. Central banks could cushion some of the economic consequences through loose interest rate and monetary policy measures, said stock market expert Andreas Lipkow. However, he added that they are constrained by the tight framework of inflation developments, which are also being influenced by the punitive tariffs. Activity in the German markets mirrored that of the Tokyo stock exchange, which tumbled on Thursday after tariff announcement. Japan's Nikkei index, comprising 225 leading stocks on the Tokyo stock exchange, fell sharply. It closed at 34,735.93, down 2.7%. In Vietnam, the stock market experienced its most significant downturn in 24 years, with the VN-Index on the Ho Chi Minh Stock Exchange (HoSE) dropping 88 points or 6.9 %, to close at 1.229,8 points, the sharpest drop in the region. Vietnam Prime Minister Pham Minh Chinh on Thursday chaired an urgent cabinet meeting to discuss measures to limit negative effects of the US tariffs. The US tariffs on Vietnam, among the highest on any of the targeted 180 economies, "did not reflect the strong bilateral relations between the two nations", state media reported, quoting Chinh. Euro gains over dollar The euro significantly gained over the US dollar in Thursday trading, reaching $1.11191 just after noon (1000 GMT), its highest level in six months, before falling slightly. Prior to Wednesday's press conference by US President Donald Trump, during which he announced extensive tariffs, the euro had been valued at $1.0850. Trump's new blanket tariffs include a minimum 10% on most US imports, with higher penalties based on trade deficits. Imports from the European Union will face a 20% tariff, while Japan, a key high-tech exporter, will see a 24% tariff. The euro exchange rate had already risen sharply in recent weeks in response to Trump's economic policies. "Remarkably, the US dollar is not benefiting as a safe haven," commented experts from Dekabank. Instead, the euro and the Japanese yen have been able to appreciate. "Apparently, investors primarily see risks for the US," they added. However, fluctuations in exchange rates are expected as trading continues. Markets are likely to hope for short-term negotiated solutions to limit the impact on the global economy. Sign in to access your portfolio
