MSCI upgrades Bulgaria to frontier; Vietnam, Argentina unchanged

MSCI Inc. reclassified Bulgaria as a frontier market, while indicating no changes to Argentina’s and Vietnam’s status in its latest review of global stock indexes. 
The index provider said that Bulgaria’s conditions had “materially improved” since the proposal to reclassify it from standalone status was launched in 2024. 

Liquidity in the local exchange has “improved meaningfully, supported by a higher number of securities meeting the Frontier Market Size and Liquidity Requirements and rising turnover,” the index provider said in a Tuesday statement. 

Implementation of the change will be done across all MSCI Indexes, coinciding with the May 2027 Index Review, it said.

MSCI — which extended its review on Indonesia’s status until November and said it will continue to monitor South Korea — indicated no changes to Argentina’s classification as a Standalone Market, effectively keeping the country out of its global stock-market indexes. The move should disappoint investors who had hoped President Javier Milei’s reforms would pave the way for a return to major equity benchmarks.

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“MSCI concluded there were not enough improvements compared with 2024 and also confirmed that Argentina will not enter the formal review process, a prerequisite for any future reclassification,” said Eric Ritondale, chief economist at local brokerage Puente in a note. “Under this scenario, the most likely window for an upgrade now shifts to 2028.”

Vietnam, which has undertaken sweeping reforms in recent years to improve market accessibility, was also not mentioned in the press release announcing the MSCI’s latest review. 

Authorities removed pre-funding requirements for equity trades, advanced plans for a centralized clearing system by 2027 and allowed foreign investors to trade via global brokerages, among other measures. Still, MSCI earlier said low free-float levels at some firms and continued limits on foreign ownership were also among hurdles for Vietnam stocks.

The MSCI classification system is one of the most widely followed benchmarks in global equity investing, dividing countries into developed, emerging, frontier and standalone categories. The higher the perceived accessibility of a market, the larger the universe of global funds eligible to invest.

MSCI Inc reclassified Bulgaria as a frontier market, while indicating no changes to Argentina’s and Vietnam’s status in its latest review of global stock indexes. 

The index provider said that Bulgaria’s conditions had “materially improved” since the proposal to reclassify it from standalone status was launched in 2024. 

Liquidity in the local exchange has “improved meaningfully, supported by a higher number of securities meeting the Frontier Market Size and Liquidity Requirements and rising turnover,” the index provider said in a Tuesday statement. 

Implementation of the change will be done across all MSCI Indexes, coinciding with the May 2027 Index Review, it said.

MSCI – which extended its review on Indonesia’s status until November and said it will continue to monitor South Korea – indicated no changes to Argentina’s classification as a Standalone Market, effectively keeping the country out of its global stock-market indexes. The move should disappoint investors who had hoped President Javier Milei’s reforms would pave the way for a return to major equity benchmarks.

“MSCI concluded there were not enough improvements compared with 2024 and also confirmed that Argentina will not enter the formal review process, a prerequisite for any future reclassification,” said Eric Ritondale, chief economist at local brokerage Puente in a note. “Under this scenario, the most likely window for an upgrade now shifts to 2028.”

Vietnam, which has undertaken sweeping reforms in recent years to improve market accessibility, was also not mentioned in the press release announcing the MSCI’s latest review. 

Authorities removed pre-funding requirements for equity trades, advanced plans for a centralised clearing system by 2027 and allowed foreign investors to trade via global brokerages, among other measures. Still, MSCI earlier said low free-float levels at some firms and continued limits on foreign ownership were also among hurdles for Vietnam stocks.

The MSCI classification system is one of the most widely followed benchmarks in global equity investing, dividing countries into developed, emerging, frontier and standalone categories. The higher the perceived accessibility of a market, the larger the universe of global funds eligible to invest.