Hanoi (VNS/VNA) - The year 2024 has been a pivotal one for Vietnam’s stock market, marked by significant legislative changes, technological advancements and dynamic shifts in investor behaviour. Below, Vietnam News listed ten key events that have shaped the market this year.
1. Revised securities law passed
On November 29, Vietnam’s National Assembly officially passed amendments to the Securities Law. This landmark legislation enhances market transparency and strengthens oversight against fraud, setting the stage for Vietnam’s stock market to achieve an upgrade in classification.
The changes aim to resolve practical challenges and boost investor confidence.
2. Adoption of non-prefunding regulations
The implementation of Circular 68/2024/TT-BTC on November 2 allows foreign institutional investors to purchase shares without upfront payment in specific cases. This critical step brings Vietnam closer to being reclassified as an emerging market, raising optimism for 2025.
3. Progress on MSCI reclassification
In June, MSCI upgraded Vietnam's 'transferability' criterion, meeting 10 out of 18 criteria required for an upgrade from a frontier to an emerging market. This improvement is attributed to increased off-exchange trading and transactions without prior regulatory approval. While the country meets 10 out of 18 MSCI criteria, efforts are focused on enhancing the remaining eight, such as foreign ownership limits and market regulations. The introduction of Circular 68 is viewed as a positive step in shaping future assessments by MSCI and FTSE Russell, indicating potential advancements in Vietnam's market evaluation.
4. Tech stocks soar amid global tides
Technology stocks surged from the year's start to end, driven by positive industry news. Despite modest market share, many tech stocks soared, with some, like FPT, achieving record-breaking performances.
FPT Corporation rose 81%, consistently breaking records. Viettel Global Investment JSC peaked at 156,000 VND per share (6.12 USD), while Viettel Construction also climbed 40%, briefly exceeding 100,000 VND a share mid-year. This sector’s boom was fuelled by groundbreaking partnerships, including a 200 million USD AI collaboration between Nvidia and FPT, cementing Vietnam’s place in the global technology map.
5. Foreign investor sell-off hits record high
In 11 months of the year, foreign investors recorded a net sell-off of approximately 88 trillion VND on the Ho Chi Minh Stock Exchange (HoSE), the highest in 24 years. January stood out as the sole month with a pause in foreign net withdrawals. However, in May and June, foreign investors withdrew over 14 trillion VND each month on the southern bourse. This significant foreign selling trend is primarily linked to exchange rate fluctuations experienced throughout the year. While this impacted market liquidity, it highlights the challenges posed by exchange rate pressures and external economic factors.
6. Cyberattacks disrupt VNDirect, PVOIL
In March, VNDirect, a leading securities company, suffered a cyberattack, causing a week-long disruption. Although reconnection was established by April 1, the system's full recovery had to proceed meticulously according to a predefined roadmap. Shortly after, on April 2, PVOIL encountered a similar attack, impacting various operational facets such as the electronic invoice issuance system, website and other applications. The incidents served as a wake-up call for the market's cybersecurity framework, prompting immediate reforms and investor support measures.
7. Investor accounts surpass nine million
Vietnam exceeded its target of nine million investor accounts a year ahead of schedule, reaching a milestone that represents 9% of the population. This growth signifies rising public interest in equity investments, setting the stage for future expansion.
8. High-profile securities scandals
Major legal cases involving prominent firms like Tan Hoang Minh and FLC revealed deep-rooted issues in corporate governance. In the Tan Hoang Minh case, Do Anh Dung, Chairman of Tan Hoang Minh Group, arranged the issuance of bonds, misappropriating over 8.6 trillion VND from 6,600 investors.
Truong My Lan, Chairwoman of Van Thinh Phat Group, embezzled over 677 trillion VND from Saigon Commercial Joint Stock Bank. She manipulated SCB for financial gain, using deceptive tactics to withdraw funds. Meanwhile, Trinh Van Quyet, former Chairman of FLC Group, committed fraud, embezzlement and market manipulation, illicitly profiting about 4.3 trillion VND.
These trials exposed significant misconduct, leading to calls for stricter regulatory measures.
9. Corporate bond market rebounds
The corporate bond market staged a comeback, with issuances totalling over 455 trillion VND by December 25, a 32% year-over-year increase. Notably, the total value of bonds issued to the public reached 46.4 trillion VND, showcasing a robust increase of over 30% over last year. New regulations aimed at transparency and quality improvement have restored investor confidence in this crucial financing channel.
10. Slow listing of new companies
Despite a robust economy, only ten companies debuted on Vietnam’s stock exchanges in 2024. Particularly, two companies moved their stocks from UPCoM to the Hanoi Stock Exchange, while eight companies were newly listed on the HoSE. This figure underscores the underuse of public listings as a capital-raising mechanism, revealing potential for growth in this area./.
