VPB Leads Foreign Buying as Vietnam Nears FTSE Russell Upgrade

Overview

Foreign investors net bought more than 30 million shares on September 15, the highest daily volume in five months, one week before Vietnam is officially upgraded to secondary emerging market status by FTSE Russell on September 21. Banking stocks, including VPB, MBB, SHB, SSB, VCB, CTG, and BID, led the buying. The VN-Index rose nearly 23 points to close at 1,811, with the VN30 index surpassing 1,950.

Key Facts

• Foreign investors net bought over 30 million shares on September 15, the highest in five months.
• Over two consecutive sessions, foreign net buying totaled VND 1,500 billion, equivalent to more than 55 million shares.
• FTSE Russell will upgrade Vietnam to secondary emerging market status on September 21.
• Index-tracking funds are expected to deploy an initial tranche of approximately USD 240 million by the end of this week.
• The VN-Index closed at 1,811 points, up nearly 23 points, with 222 gainers and 86 decliners on the Ho Chi Minh Stock Exchange.
• Market liquidity reached approximately VND 16,700 billion, down nearly VND 3,000 billion from the start of the week.
• VIC was the only stock with over VND 1 trillion in matched orders, followed by BSR, SHB, VPB, and VCB.

What Happened

Foreign investors net bought more than 30 million shares on September 15, the highest daily volume since April, according to market data. The buying followed two consecutive sessions of net purchases totaling VND 1,500 billion, or over 55 million shares. The flow was concentrated in banking stocks, with VPB, MBB, SHB, SSB, VCB, CTG, and BID among the most bought names. This helped the VN-Index break a sharp correction and close up nearly 23 points at 1,811, while the VN30 index exceeded 1,950 points. The Ho Chi Minh Stock Exchange saw 222 gainers against 86 decliners.

According to analysts at Rong Viet Securities, the impact of the upgrade on the VN-Index level will not be large but leans positive. The effect will be more pronounced at the individual stock level as large supply or demand must be absorbed relative to liquidity. Historical data from markets previously upgraded by FTSE Russell shows that liquidity in the month the upgrade takes effect is typically 1 to 3 times the 12-month average, after which capital flows often drop sharply. Rong Viet noted that the VN-Index has risen 10.3% over the past 11 months, while August liquidity was only about 0.59 times the 12-month average, suggesting more room for trading volume growth than for index gains. MB Securities analysts cautioned that September has historically shown less positive performance, advising investors not to chase prices or open new long positions, especially during a week with many important events.

Market Context

VPB closed at VND 27,650 on September 15 on the Ho Chi Minh Stock Exchange (HOSE). The banking sector was the strongest performer, with common gains of 1.5%. SSB was the only bank to hit the ceiling price and closed with no sellers. The energy sector also reversed from declines to gains, with BSR surging to the ceiling price of VND 30,450 and a buy surplus of over 2.4 million shares. Securities stocks were active, with VCI, SSI, and HCM each gaining over 1% from the reference price. Market-wide liquidity reached approximately VND 16,700 billion, down nearly VND 3,000 billion from the start of the week.

Strategic Significance

The FTSE Russell upgrade is a structural event that can attract long-term passive and active foreign capital. For VPB, inclusion in the buying list reflects its status as a large-cap bank with sufficient liquidity to absorb index-tracking flows. The initial USD 240 million inflow is small relative to the market’s daily turnover, but it signals the beginning of a broader re-rating process. As foreign ownership limits and sector weights adjust, banks like VPB may benefit from sustained demand. However, the historical pattern of liquidity spikes followed by sharp drops suggests that the immediate boost may be temporary. The strategic thesis hinges on whether the upgrade leads to a durable increase in foreign ownership and a lower cost of capital for Vietnamese banks over the medium term.

What to Watch

• FTSE Russell’s official upgrade effective date on September 21 and subsequent index rebalancing announcements.
• Foreign net buying trends in the days following the upgrade, particularly in VPB and other banks.
• Third-quarter earnings releases from Vietnamese banks, expected in October, for signs of fundamental support.
• State Bank of Vietnam policy meetings and any changes to foreign ownership limits in the banking sector.
• Market liquidity levels and whether they sustain above the 12-month average after the upgrade.