Vietnam’s currency markets Asia’s strongest up to now this year
13 June, 2021
Vietnam’s stock market has got evolved into Asia’s strongest this season, with the country’s benchmark VN-Index surging more than 20 per cent on the first five months of 2021 - the highest among major benchmark indexes on Asia and among the best in the world.
The growth was mainly driven by an influx of latest foreign investors, exceeding those from South Korea and Taiwan that grew at a lot more than ten % in the first five months.
One of the reasons why Vietnam’s currency markets has surged previously five months is that the federal government has continued to keep a monetary easing policy, which means banks experience kept their deposit rates low, VnExpress International cited Nguyen The Minh, director of analysis in brokerage Yuanta Vietnam.
Amount of new treading accounts surges
The low return on deposits prompted persons to look for considerably more promising investment channels, plus they have zeroed in on the currency markets. The amount of new domestic specific trading accounts opened last month tripled year-on-year to 110,000.
With trading volume having more than quadrupled since the end of 2019 and 11 stocks exceeding $5 billion in market value, up from two in 2015, Vietnam is currently considered an “investable market,” according to HSBC analysts.
They and others cite solid economic prospects, relatively attractive valuations, rising foreign-direct investment flows and healthy earnings growth as factors to be optimistic, while as well showing faith in the government’s capability to contain the pandemic.
Trading overload amid “extreme” liquidity
The strong trading activity has, however, also led to problems. In the latest days, attention was centered on the Ho Chi Minh Stock Exchange’s trading overload which has caused non permanent shutdowns. The bourse described that its platform was paralysed after sudden “unnecessary” liquidity, leaving a large number of investors struggling to trade.
Numerous securities companies possess announced their short-term suspension in response. Overloading issues have been subject of controversy for much of the year, with the blame being related to poor management and an age-older technology at the exchange.
The bourse promised to iron out the technical issues immediately, noting that the trading congestion didn't deter investors.
Source:
TAG(s):