Representative of Yuanta Securities Company said that the fact that the Vietnam’s benchmark VN-Index dropped to around 970 points from its high of 1,014 points at the end of March was partly because of the withdrawal of foreign capital flow from the market.
In the first quarter of this year, foreign exchange traded funds (ETFs) had strongly attracted foreign capital flow, thereby sending the VN-Index to hit a record high of 1,014 points. After that, the market plummeted, especially in August, the market had seen the strongest net selling of foreign investors with total value of up to US$35 million, mainly because ETFs investing in Vietnam were being withdrawn capital.
Vietnam’s market was unable to avoid the global net capital withdrawal tendency of ETFs at emerging markets and Asia Pacific markets. However, it is said that in the last quarter of this year, the Vietnam’s stock market will regain optimism thanks to the return of foreign capital flow and the benchmark will reach 1,100 points.
Some US investment funds have been showing interest in Vietnamese market through the upcoming ETF of the VietFund Management Company. In addition, the fact that the Government released the list of enterprises to be equitized until 2020 was also the factor that attracts foreign capital flow in the near future.
