Vietnamese stock market faces FTSE Russell mid-year upgrade review with VN-Index hovering above MA200

Beyond expectations for FTSE’s mid-year upgrade, Vietnam’s stock market is also supported by structural and cyclical factors. The VN-Index has generally strengthened after breaking above the key resistance near the 200-day moving average (MA200) at around 1,650 points, and the market is entering a new week with information that could influence the upgrade trajectory.

FTSE mid-year review seen as a key catalyst

Market sentiment is focused on the potential for large-cap inflows. On the morning of April 8, 2026, FTSE Russell is expected to publish its mid-year review results, which analysts view as an important test for Vietnam’s upgrade path.

April outlook: two scenarios

Nhất Việt Securities (VFS) analysts outline two equally probable paths for April:

• Positive scenario (50%): If Vietnam receives favorable signals on upgrade progress from FTSE and foreign investors return to net buying, the VN-Index could decisively move away from MA200 and head toward around 1,750 points.
• Cautious scenario (50%): If Middle East geopolitical tensions escalate and oil prices rise sharply, the market may retest 1,520 points. A break below 1,520 would indicate a longer-term downtrend.

Potential passive inflows and likely allocation pace

SSI Research says Vietnam remains on track to graduate to a FTSE-class emerging market in 2026. It estimates passive fund inflows from global ETFs at about $1.67 billion. If the review is successful, SSI Research expects passive inflows to begin from September 2026.

SSI Research expects passive funds tracking emerging markets to prioritize large-cap stocks with high free float and good liquidity. Forecast inflows include:

• VIC (Vingroup): about $414 million
• HPG (Hoa Phat): about $147 million
• VHM (Vinhomes): about $92 million
• FPT (FPT): about $90 million

Other large names expected to attract substantial funds include MSN (Masan), SSI, and VNM (Vinamilk), which SSI Research says could provide additional support if the upgrade proceeds.

SSI Research also notes that the capital is unlikely to be deployed all at once. Instead, it is expected to be allocated in phases over 3–5 quarters, similar to the pattern observed in 2019 in Saudi Arabia. This phased approach is expected to help the market absorb inflows more efficiently, reduce short-term volatility, and support medium-term growth after the upgrade.

Market infrastructure reforms move toward MSCI standards

Reforms to market infrastructure and operations are progressing, including removal of the pre-trade margin requirement, higher information-disclosure standards, loosening foreign ownership limits, and implementation progress for the central counterparty clearing (CCP) mechanism.

Along with the KRX trading system and recent legal updates, these steps are viewed as important for aligning with MSCI standards—particularly in transparency, accessibility, and efficiency for foreign institutional investors. The report states: “With the reforms underway, Vietnam now meets 17 of 18 MSCI criteria. The final hurdle is FX liberalization being considered, although experiences from India or Indonesia show this is not an absolute barrier to upgrading.”

Global and domestic drivers to watch

Globally, investors are monitoring developments related to the Middle East conflict, with expectations that outcomes will depend on decisions by the US and Iran, influencing energy price expectations.

Analysts also point to upcoming focus on US inflation and the Fed’s rate path. These factors are expected to affect global interest rates, domestic exchange-rate pressure, and the room for monetary policy. If the Fed maintains a cautious stance or delays rate cuts, analysts warn currency pressures and capital outflows could increase.

Domestically, analysts see continued support from structural and cyclical drivers. A two-digit GDP growth target is cited as a key foundation, while exchange-rate stability could provide additional room for market support.

Equities are also viewed as becoming more attractive relative to other channels. After two years of strong growth, real estate and gold have cooled, and tighter government oversight of the crypto sector could redirect speculative demand back into stocks.

In addition, upcoming IPOs by Highlands Coffee, CP, Dien May Xanh, HDBS, and LPBS are expected to add supply of quality shares and attract more investor attention.

Valuation support and near-term positioning

From a broader perspective, Nguyen The Minh, Director of Retail Research and Development at Yuanta Vietnam, says current valuations provide meaningful support. He notes the VN-Index P/E on trailing four-quarter earnings is around 13x, below the long-run average, while the forward P/E for 2026 is around 12x, indicating valuations are becoming more attractive. He also adds that short-term oversold conditions may trigger buying demand in the coming sessions.