Vietnam’s Stocks Surge as Dong Hits Record Low

Taiwan shares also jump; Asia markets show mixed results after trade deal.

Following news of a trade agreement with the U.S., Vietnamese stocks have soared, reaching levels unseen in over three years. However, the Vietnamese dong has simultaneously weakened to a record low against the dollar, highlighting potential economic complexities.

Vietnam Index Reaches New Heights

The benchmark Vietnam Index increased by 0.3%, achieving its highest point since April 2022, according to LSEG data. The best performing sectors included basic materials and technology. Key gainers comprised Saigon Machinery Spare Parts, rising 6.25%, and Truong Tranh Furniture Corporation, climbing 6.6%. Vietnam Container Shipping also experienced a notable rise of 4.4%.

Dong’s Depreciation and Trade Deal Implications

LSEG data indicated the Vietnamese dong depreciated to a record low of 26,195 per dollar following the U.S. trade deal. While the agreement boosted U.S. equities, **Vishnu Varathan**, Mizuho Securities’ head of macro research for Asia ex-Japan, cautioned against assuming similar optimism across all Asian markets.

“For one, the deal with Vietnam is a stark reminder of the imbalance in leverage, to the disadvantage of Asian exporters,” he wrote in a Thursday note. However, he noted the dong’s depreciation might buffer the impact of the 20% tariffs.

For context, a recent report by the World Bank indicated that currency depreciation can lead to increased export competitiveness but also raises the cost of imports, potentially fueling inflation (World Bank 2024).

Taiwanese Stocks Experience Gains

Taiwanese stocks also saw positive movement, jumping as much as 1.1% to reach their highest level since March 6, per LSEG data. Technology and consumer cyclical stocks primarily drove these gains. Shares of Powertech Industrial, a semiconductor packaging and testing company, led the surge with a 10% increase. Win Win Precision Industrial rose 7.2%, and Nan Ya PCB Corporation, a circuit board manufacturer, climbed over 9%. Lai Yih Footware also saw a significant jump of 8.52%.

Mixed Performance Across Asia-Pacific Markets

Asia-Pacific markets displayed mixed results as of 8 a.m. Singapore time. Japan’s Nikkei 225 slipped 0.15%, and the Topix lost 0.21%. Conversely, South Korea’s Kospi added 0.77%, and the small-cap Kosdaq rose 0.5%. Australia’s S&P/ASX 200 increased by 0.13% at the open.

U.S.-Vietnam Trade Deal Details

**President Donald Trump** announced Wednesday that the United States and Vietnam had reached a trade agreement that imposes a 20% tariff on Vietnamese imports to the U.S.

The US and Vietnam have agreed on a new trade deal. It's huge! 🇺🇸🤝🇻🇳 pic.twitter.com/mxnC2KjCm4

— Donald J. Trump (@realDonaldTrump) July 3, 2025

According to **Trump**, the deal grants the U.S. tariff-free access to Vietnam’s markets. Additionally, Vietnam has agreed to a 40% tariff on goods originating from other countries and transshipped through Vietnam to the United States. This measure aims to prevent the circumvention of trade barriers, a practice reportedly used by China.

Wall Street’s Wednesday Close

On Wednesday, the S&P 500 and the Nasdaq Composite both closed higher. The S&P 500 increased by 0.47% to close at 6,227.42, and the Nasdaq jumped 0.94%, finishing at 20,393.13. The Dow Jones Industrial Average, however, edged down by 10.52 points, or 0.02%, to end the day at 44,484.42.