Vietnam and emerging markets Rally on!

Rally on Dude!

The market here seems to be high as a kite. Partying on through a most excellent adventure a la Bill & Ted.

But what are the fundamentals to support all the ecstasy and good vibrations?

Aw shucks, but lets not be a buzz kill, shall we?

First the facts.

Vietnam's VN Index broke the 400 barrier and did so with conviction. From HSC:

The market made further gains today as the index consolidated its position above the 400 level in higher trading volume of VND1,901.15 billion or US$112.25 million. The VN index moved up another 2.36% to end the day at 410.38. 147 shares rose while 16 issues fell. And 108 shares went to the ceiling while 3 shares fell to the floor. Foreigners accounted for 11.03% of the buying value and 6.03% of the selling value.

The market opened higher and quickly hit the session high of 412.21 where we traded for most of the day before closing just below that level. The daily trading range was wide at 12 points and turnover was much higher today. After the end of the first session, about 9 million shares were offered and 50 million shares were bid. And towards the end of the day, around 7 million shares were offered and 46 million shares were bid...

But the party is a whole lot bigger than Vietnam. Emerging markets are on FIRE.

In case you missed it, here is the global leader board year-to-date:

Peru +73%
Russia +53%
India +48%
China +47%
Taiwan +45%
Ukraine +44%
Argentina +43%
Indonesia +39%
Israel +39%
Brazil +37%
Sri Lanka +35%
Norway +29%
Egypt +29%
Chile +29%
Singapore +28%
Vietnam +27%

Year to Date Country Returns: U.S. Lags

After nearly every country was down earlier in the year, 62 out of the 83 are now up in 2009. Peru is up the most at 72.92%, while Costa Rica is down the most at -39.94%. And the BRIC (Brazil, Russia, India, China) countries are significantly outperforming the developed G-7 countries. Russia, India, and China rank 2nd, 3rd, and 4th in terms of year to date performance, and Brazil isn't far behind in 10th place.

Canada has been the best performing G-7 country with a gain of 12.62% in 2009, but it ranks 35th out of 83. The rest of the G-7 countries are bunched up in the 0%-5% range, which is closer to the bottom of the list than the top. And the US is the worst of the seven with gains of less than 1%...

Vietnam is in 16th place "only" up 27%.

So it's party time for the emerging markets, but who spiked the electric kool aid punch bowl and how long can it last...