What’s Really Happening with Vietnam’s Stock Market?

In a stunning reversal, Vietnam’s benchmark VN-Index just recorded its biggest single-day gain in history, with all VN30 stocks hitting their daily upper limit — effectively showing no sellers on the board. More than 1,100 stocks posted gains, and over 700 hit their ceiling price. It’s a complete turnaround from just one day earlier, when the index plunged for a fourth straight session to a 15-month low.

Until yesterday, the market was weighed down by margin calls and forced liquidations, with panic selling hitting even blue-chip stocks. Investor sentiment was in free fall, haunted by urgent questions like:

“Should I cut losses or hold?”
“Is it worth averaging down?”
“Where can I find cash to top up margin accounts?”

And then, overnight, everything changed.

The market rebounded as if the crash had never happened. Buy orders at ceiling prices flooded in, but barely any matched. Liquidity all but vanished after the ATO (At the Open) session. So what triggered such a dramatic shift?

The Psychology Behind the Volatility

There’s no single explanation for the wild swings in Vietnam’s stock market — but one undeniable factor is investor psychology. With individual investors accounting for around 90% of daily trading volume, emotions and sentiment play a massive role in market movements.

Much of this sentiment is driven by news cycles, often unverified or speculative. Retail investors frequently react to headlines — sometimes rumors — searching for meaning behind every move. Anything can be interpreted as a reason for a stock or the market to go up or down.

And then there’s the powerful force of FOMO — the fear of missing out. It leads to erratic behavior: selling off in panic one day, buying back in desperation the next. Many investors lack the discipline and risk management skills to navigate such volatility.

Even seasoned professionals weren’t spared in this latest market drop. The swiftness and depth of the correction caught many off guard, reinforcing the harsh reality that short-term trading is high-stakes and unforgiving. As some industry veterans put it, 95% of retail investors end up losing money.

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(Image: Mạnh Quân)

Market Forecasting: A Fool’s Game?

Attempting to predict short-term movements in the stock market is notoriously difficult. Dominic Scriven, Chairman of Dragon Capital — Vietnam’s largest fund manager — once said, “Even after 30 years in the market, I still can’t tell whether it’ll go up or down tomorrow.”

While short-term trading adds liquidity to the market, experts advise retail investors to build balanced portfolios that combine short-term opportunities with long-term investments. A reasonable margin ratio is also essential to avoid pressure during corrections and preserve the potential for future gains.

What’s Driving the Rebound?

One factor behind the recent recovery could be the temporary suspension of reciprocal tariffs by Donald Trump, offering a dose of relief to the market. But this is far from the end of the story — trade negotiations are ongoing, and the final outcome remains uncertain.

While the strong rebound has helped ease investor anxiety, caution is still warranted. The global economic outlook remains volatile, and external shocks could continue to affect Vietnam’s market.

The Long-Term Outlook Remains Bright

Despite short-term turbulence, Vietnam’s stock market maintains solid long-term fundamentals. With a stable macroeconomic environment, strong corporate earnings growth, attractive valuations, and growing momentum toward an upgrade to emerging market status, the long-term story is intact.

For investors willing to stay grounded, Vietnam’s market continues to offer exciting opportunities — just not without the usual thrills and spills.

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Source: Vietnam Insider