Fed’s Interest Rate Hike to Dampen Foreign Buying in Vietnam’s Stock Market

Tuan Minh

18:51 15/11/2017

BizLIVE - Foreign buying is forecast to gain momentum in the first quarter next year after the effect of the Fed’s rate increase fades away.

Fed’s Interest Rate Hike to Dampen Foreign Buying in Vietnam’s Stock Market

The Fed is set to increase rates again in December. Photo: Lucas Jackson/Reuters

Net purchases by foreign traders in the Vietnamese stock market is waning in the short term as the U.S.’s Federal Reserve Fund (Fed) is widely expected to raise interest rates again in December and several offshore funds reshuffle their portfolios, the National Financial Supervisory Commission has said in a monthly report.
It pointed out that their net buying value slipped to $23 million in October, from $33 million in September and $115 million in August. September was the first in nine months that overseas players net sold local equities.
The commission forecast foreign buying to gain momentum in the first quarter next year after the effect of the Fed’s rate increase fades away and a new investment cycle starts.
Between January and October, overseas investors net bought $1.426 billion in the local stock market, including $811 million in bonds and $615 million in equities, according to the report.
Foreign traders have been expanded their buying spree of Vietnamese equities and bonds since the start of this year as the benchmark VN Index has been one of the best performers in the world. In the ten months through October, the gauge jumped nearly 26%.
The value of their securities portfolios grew 36% in the ten months through October to $27.8 billion. Compared to the previous month, the value increased $500 million, the commission said.
It noted that foreign holdings made up 19.3% of the local share market and 5.3% of the bond market, nearly unchanged from the previous month.

TUAN MINH

Từ khóa: VN Index, Vietnam, Fed

BizLIVE Gặp gỡ