[Alpha Biz= Paul Lee] HANOI, Aug. 20 — Vietnam’s stock market has surged to record levels, fueling optimism among global investors. Despite its sharp 10% rally in just the first half of August, analysts say policy momentum and the prospect of inclusion in global emerging market indices suggest that the rally still has room to run.



According to Investing.com, the benchmark VN Index in Ho Chi Minh City closed at 1,664.36 on August 20, marking a fresh all-time high after breaking the 1,600 mark for the first time on August 12. The index has risen 10.77% this month, gaining more than 500 points since April when U.S. tariff concerns weighed on the market. The rally is also being felt by Korean investors: the ACE Vietnam VN30 (Synthetic) ETF, managed by Korea Investment Management, climbed 9.79% over the past month, outperforming ETFs tracking the KOSPI, S&P 500, and Nasdaq 100.



Analysts attribute the surge to easing external uncertainty following U.S. trade negotiations, Vietnam’s pro-growth government policies, and ample liquidity injections. Ahead of next year’s general election, the government has accelerated public investment spending and raised its 2025 GDP growth target to 8.3–8.5% from 8.0%. The central bank is also pushing lending rates lower to support corporate financing.



A key catalyst for investors is the potential reclassification of Vietnam from a “frontier” market to “emerging market” status by FTSE Russell. If approved in October, analysts estimate the upgrade could attract up to USD 6 billion in passive inflows.



Vietnam’s economic fundamentals remain solid. Foreign direct investment (FDI) inflows jumped 33.8% year-on-year through July, reaching a record high, while first-half GDP growth of 7.52% was the strongest since 2007. Trade ties are also deepening: during a recent visit to Seoul, Vietnam’s Communist Party chief set a target to raise bilateral trade with South Korea to USD 150 billion by 2030.

 

 

 

 

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