After Massive Exit in 2016, Foreign Traders Show Strong Appetite for Vietnamese Shares

Foreign investors had high appetite for Vietnamese shares in the first six months of this year as the local government takes bold measures to bolster economic growth.

Overseas investors net poured 9.05 trillion dong ($398 million) into Vietnamese equities in the first half of this year, giving a boost to major stock indexes, as the government loosens trading regulations and stimulates economic growth.

Strong purchasing activity indicates a change in foreign investors’ course after they net unloaded $298 million worth of local shares in 2016 after a 10-year buying spree.

On the Ho Chi Minh City Stock Exchange (HOSE), they net bought 8.83 trillion dong ($389 million) worth of shares and fund certificates in the six-month period while net selling 6.02 trillion dong in the second half of 2016.

Dairy producer Vinamilk (VNM) as the most favorite stock of foreign traders who net spent up to 4.34 trillion dong to acquire 31.47 million shares of the company. Singapore’s F&N Dairy Investments, which is seeking to increase its foothold in the Vietnamese beverage market, was the biggest buyer.

Steel producer Hoa Phat Group (HPG) and constructor FLC Faros (ROS) are the next most favored tickers.

Meanwhile, PV Drilling (PVD) was the most sold stock in the period amid a plunge of global crude oil prices.

Foreign traders net sold 300 billion dong worth of Vingroup (VIC), the largest publicly-traded real estate developer in Vietnam.

Trading activity on the Hanoi Stock Exchange (HNX) was more lackluster, with foreign investors net buying just 217 billion dong.

Foreign activeness helped lift the benchmark VN-Index of the HOSE by 16.8% to end June at 776.47.  Meanwhile, the HNX-Index grew 23.7% to 99.14.

The Vietnamese government has shown determination to achieve its GDP growth target of 6.7% set for this year despite global and domestic headwinds. The country’s economy expanded 6.17% in the second quarter of this year, compared to a growth rate of 5.15% in the previous three months.

Tuan Minh / BizLIVE