Bloomberg, a premier site for business and financial market news in the world, has just issued new evaluation on foreign investors' trust in Vietnam's market after happenings related to China's putting oil rig in Vietnamese waters...
Bloomberg, a premier site for business and financial market news in the world, has just issued new evaluation on foreign investors’ trust in Vietnam’s market after happenings related to China’s putting oil rig in Vietnamese waters.
According to Bloomberg, the 18-day flow of money into the country’s stock market suggests overseas money managers are unfazed. Foreign investors were net buyers on the Ho Chi Minh City Stock Exchange every day since April 18, the longest stretch of purchases since January, as valuations fell to a four-month low. They added about $93 million to their holdings even as the benchmark VN Index (VNINDEX) slumped 8.8 percent through May 16.
Advance Emerging Capital, Samsung Asset Management and Jefferies Group Inc. say they’re still upbeat about Vietnam as inflation stays low, the government removes bad debt from banks and the prospect of a Trans-Pacific Partnership trade deal bolsters the outlook for exporters.
“Our view of the outlook for Vietnam remains bullish,” Bloomberg quoted Samir Shah, an investment manager at Advance Emerging Capital in London, which oversees about $750 million, who trusts that, “Steady economic progress looks set to continue.”
International investors have bought a net $188 million of Vietnam stocks in 2014, heading for the ninth straight year of purchases, according to data compiled by Bloomberg. Companies including PXP Vietnam Asset Management say the Government may raise foreign ownership caps this year, giving investors even more room to boost holdings.
U.S.-based exchange-traded funds focused on Vietnam have received a net $99.9 million this year, equivalent to almost 27 percent of their total market capitalization, according to data compiled by Bloomberg. That’s the biggest increase of all 12 Asian countries tracked by Bloomberg.
The Southeast Asian nation granted 291 new trading accounts for foreigners in the first four months of 2014, bringing the total to 17,022, according to data from Vietnam Securities Depository, which offers trading support services.
Vietnamese policy makers are trying to bolster an economy that the World Bank estimates will grow 5.4 percent this year. Gross domestic product rose 4.96 percent in the first quarter of 2013, while inflation fell below 5 percent in February for the first time since 2009.
Vietnam’s government set up an asset-management company in July to acquire non-performing loans and has also allowed foreign investors to take bigger stakes in local lenders. Negotiators are still working to conclude the Trans-Pacific Partnership free-trade deal, which would link a region with $28 trillion in annual economic output, about 39 percent of the world total.
T.T
