Southeast Asia Information Portal (www.dnyxxg.com) – Global capital is accelerating its return to Southeast Asian stock markets this month, propelling the region to become one of the most watched core areas in the global financial sector in 2026.
Attracted by both undervaluation and the need for global portfolio diversification, net foreign investment inflows into emerging Southeast Asian markets reached US$337 million in December 2025, a figure expected to be the highest monthly figure since September 2024. Indonesian and Thai stock markets performed particularly well – after experiencing net outflows for 10 out of the previous 11 months, these two markets are leading the way in the return of foreign capital.
Christopher Wong, portfolio strategist at Fidelity International, stated, “The ASEAN market will continue to benefit from investors’ asset allocation adjustments, with a general desire to diversify portfolios away from the US market and sectors such as artificial intelligence that have already experienced over-capitalization.” He further added that the “differentiated growth drivers” of the ASEAN market will be one of its core competitive advantages in attracting foreign investment.
Vietnam's stock market also received a significant boost, with FTSE Russell's decision to upgrade it to a secondary emerging market category, expected to bring more incremental funds and market attention.
From a fundamental perspective, the earnings prospects of stock markets in Indonesia, Vietnam, and the Philippines are continuing to improve. This is partly due to large-scale fiscal spending plans launched by these governments, focusing on strengthening infrastructure construction and boosting household consumption; and partly due to the loose monetary policies implemented by some countries, which have provided strong support for market liquidity and economic recovery.
Analysts point out that if foreign ownership in Southeast Asian markets can return to the average level of the past three years, the region could see a potential net inflow of up to US$20 billion. (End)
