The VNI declined 3.5% MoM in September to 1,768.6. Although macro fundamentals remained solid and Vietnam was officially upgraded to FTSE Russell's Secondary Emerging Market status effective September 21, market sentiment remained weak, with trading liquidity declining for the fourth consecutive month and foreign net selling increasing from August. Several factors weighed on market sentiment during the month, including:
- The US Federal Reserve (Fed) raised its policy rate by 25 bps in September, while global bond yields continued to rise, with the US 10-year Treasury yield ending the month at 5.29% (+54 bps MoM), its highest level since April 2002.
- Meanwhile, global oil prices remained elevated amid prolonged geopolitical tensions, with average Brent crude prices rising 14.4% MoM.
- Trading liquidity remained subdued, partly reflecting the persistently high domestic interest-rate environment.
- Foreign selling intensified, with foreign investors accelerating their net selling in September.
- Vingroup-related stocks corrected and weighed significantly on the VN-Index, accounting for around 45% of the index's total decline during the month.
In 9M 2026, the VNI declined slightly by 0.9%, outperforming Indonesia's JCI (-29.8%) and the Philippines' PCOMP (-6.2%), but underperforming Thailand's SET (+23.8%).
More than half of sectors declined, with financial services recording the largest loss. Among the five sectors that gained in September, oil & gas rose 10.4%, primarily supported by BSR (+18%), while insurance increased 8.9%, mainly driven by BVH (+16%). In contrast, the three worst-performing sectors were financial services (-11.4%), technology (-5.4%), and real estate (-5.0%).
Trading activity remained subdued for the fourth consecutive month. ADTV on the HSX and across all three bourses declined 5.3% and 5.1% MoM to USD633mn and USD682mn, respectively, both marking the lowest levels since February 2025. In 9M 2026, combined ADTV averaged USD977mn, declining 13.1% YoY.
Foreign net selling increased in September, extending the selling streak to nine consecutive months. In September, foreign investors net sold USD185.8mn on the HSX and USD4.2mn on the HNX, while they net bought USD11.0mn on the UPCoM, resulting in total net selling of USD179.1mn across the three bourses. Top foreign net sells included VHM (-USD92.6mn), VIC (-USD48.0mn), and VPB (-USD43.6mn). In contrast, the top foreign net buys were FPT (+USD33.2mn), BSR (+USD28.8mn), and MCH (+USD27.9mn). In 9M 2026, foreign investors net sold USD3.8bn in Vietnam's equity market. They also net sold USD4.7bn on Indonesia's JCI and USD536mn on the Philippines' PCOMP, while they net bought USD814mn on Thailand's SET.
Outlook: The VN-Index could be supported in October by the upcoming Q3 earnings season, potentially strong Q3 and 9M economic data, and more attractive valuations following the September correction. At end-September, the VNI traded at a TTM P/E of 13.5x, broadly in line with Indonesia's JCI at 13.4x, below Thailand's SET at 14.7x, but above the Philippines' PCOMP at 8.5x. Potential FTSE-related inflows could provide additional support, although the timing and magnitude remain uncertain. However, persistently high domestic interest rates, subdued market liquidity, and continued foreign selling are likely to continue weighing on market sentiment.
