Trade war a boost for Chinese stocks, analysts say

Since 2024, foreign investors have sold over 147 billion baht worth of Thai stocks. From the beginning of 2025 to March 14, net foreign fund outflows from the Thai stock market reached 30.77 billion baht and the trend is continuing.

Ratasak Piriyanont, senior director of research at Kasikorn Securities, believes that foreign fund flows are likely to remain in “net selling” territory as Thai stocks are less attractive in comparison with other markets.

While Thai stock valuations are not high relative to historical averages, other regional markets offer lower valuations, stronger economic growth and better corporate earnings prospects.

Since the beginning of the year, the Thai baht has remained stable within the 33.50–34.30 baht/US$ range, supported by foreign inflows into Thai bonds. This is driven by expectations of a policy rate cut due to Thailand’s slow economic recovery and below-target inflation.

However, in the next 2–3 months, the baht is expected to weaken to 34.50–35 baht/dollar as foreign investors may continue selling Thai risk assets, aligning with broader trends in emerging markets amid rising trade war uncertainties.

Additionally, April and May mark Thailand’s dividend payout season, typically leading to capital outflows as foreign investors repatriate dividends.

As a result, the Thai stock index remains at risk of further volatility, with key support levels at 1,095–1,130 and resistance at 1,240–1,270 points.

Capital outflows from US stocks and surge in gold price

Before the US stock market rebounded on Friday (March 140, Bank of America (BofA) reported that, in the week ending March 12, there was a record $2.8 billion in capital outflows from US stock funds, the highest this year. This reflects a bearish sentiment in global financial markets as the S&P 500 index dropped more than 10% from its peak, entering a correction phase.

On the other hand, US bond markets saw an inflow of $6.4 billion, the highest since August 2024, and European stocks saw an inflow of $5 billion. BofA noted that US stocks are now in a “risk-off” mode. Analysts pointed out that the outflows are still minor compared to the $156 billion flowing into global equity funds this year.

In the gold market, global prices broke through the significant $3,000 mark for the first time on March 14. Investors flocked to safe-haven assets, pushing spot gold to a record high of $3,004.86 before retreating slightly to $2,986.26. US gold futures rose by 0.3% to $3,001.10. So far this year, gold prices have surged nearly 14%.

US-China trade war sparks shift to Chinese stocks

Reuters reports that the US trade war has revived the Chinese stock market. The Hang Seng index in Hong Kong, which includes several large Chinese companies, has risen by 17% since January when Trump took office and began raising import tariffs, causing concerns among US investors about a potential economic recession.

The US stock market has continued to decline, with the S&P 500 down by around 9%, and the market value has fallen by more than $4 trillion from its all-time high in February.

Andy Wong, an executive at Pictet Asset Management, said that investors have shifted their mindset from “TINA” (There Is No Alternative) to “TIARA” (There Is A Real Alternative), meaning they now see opportunities outside US assets.

Wong highlights the potential in technology, defence, and consumer goods stocks, with Chinese tech stocks showing significant growth. Since the beginning of the year, this sector has risen by 29%, reaching its highest level in three years last week.

Additionally, fund managers and analysts from over 12 firms have noted that investors are pulling funds from South Korea and India, which are facing their own challenges. JPMorgan Chase has also observed record-high exchanges of US dollars and yuan for Hong Kong dollars in recent weeks, indicating a significant capital inflow into the Hong Kong stock market