Vietnam's State Securities Commission Orders Increased Oversight of Stock Transactions Amid Market Rally.

Vietnam's State Securities Commission has ordered stricter oversight of stock transactions, directing exchanges to closely monitor unusual activities and price movements, and coordinating with the Vietnam Securities Depository and Clearing Corp. to ensure safe and stable trading. The directive comes amid a 25% rally in the benchmark VN Index this year, fueled by a retail trading boom and a record $10.9 billion in margin loans.

The Vietnam State Securities Commission (SSC) has implemented stricter oversight measures to monitor stock transactions, following a 25% rally in the benchmark VN Index this year. The directive comes amidst a retail trading boom and a record $10.9 billion in margin loans, highlighting the need for enhanced regulatory scrutiny [1].

The SSC has directed stock exchanges to closely monitor unusual activities and price movements, while coordinating with the Vietnam Securities Depository and Clearing Corp. (VSDCC) to ensure safe and stable trading. The move aims to mitigate the risks associated with the current market dynamics, particularly the surge in retail participation and leverage [1].

The benchmark VN Index has outperformed other major benchmarks in Southeast Asia, reaching a record high in recent months. This performance has been driven by a combination of factors, including a 22% rally this year, the expected FTSE Russell upgrade of Vietnam stocks to secondary emerging-market status, and a deal that lowered US tariffs on Vietnam goods to 20% from 46% in April [1].

The retail trading boom has been a significant contributor to the market's performance, with over 80% of the bourse's trading value attributed to retail investors. The number of new trading accounts has increased by more than 970,000 in the first half of 2025, pushing the total past 10 million. This surge in retail participation has been fueled by persistently low deposit rates and the rising cost of traditional investments like gold [1].

However, the intensity of the retail surge has raised concerns about a potential correction. Margin loans, which have reached a record $10.9 billion in the second quarter, amplify the risk of a sharp pullback if sentiment sours. The last time the benchmark gauge hit a record high in January 2022, stocks fell more than 20% within four months [1].

The SSC's directive underscores the importance of maintaining market integrity and stability, especially during periods of heightened volatility and investor enthusiasm. The regulatory measures aim to balance the need for growth and innovation with the protection of investors and the broader financial ecosystem [1].

References:
[1] https://www.bloomberg.com/news/articles/2025-08-06/vietnam-stocks-see-biggest-rally-since-2021-on-lower-trump-tariffs-weak-usd