Thai stocks index falls as external factors mount up
The Thai stocks index (SET) dropped sharply by over 30 points on October 26, heading in the same direction as regional stock markets due to external factors, specifically the ongoing Israel-Hamas conflict and the policy directions of the US Federal Reserve.
It is anticipated that the Thai stock market will continue to fluctuate until these external factors become clearer. However, the fundamentals of the Thai stock market remain sound, SET president Pakorn Peetathawatchai emphasised.
Throughout this year, there has been an outflow of funds of more than 170 billion baht, mostly short-term investments, compared to over 200 billion baht of foreign funds inflow in the previous year. The market believes that a turning point for the Thai stock market could occur if external factors ease.
Short-selling currently stands at 11.34%, which is not significantly different from the usual range of around 12%. Program trading stands at 36%, which is also within the normal range of 30% to 38% used on an average day.
The Thai bourse continues to closely monitor this information.
Pakorn stressed that the 30-point decrease in the Thai stock market that occurred on October 26 is a global phenomenon is global and not unique to the Thai stock market. Investors are encouraged to evaluate companies based on their profit-making capabilities, as registered companies in Thailand remain robust. The impact has been limited to specific export-dependent industries and global market-oriented businesses. Therefore, a comprehensive analysis considering these aspects is necessary, the SET president said.
Additionally, an overview of Thailand's fundamental factors is crucial. Thailand's economic fundamentals are strong, financial institutions are robust, non-performing loans (NPLs) are at low levels, and foreign debts are manageable. Furthermore, Thailand's investments in infrastructure are considered advantageous compared to many other countries in the region, supporting economic expansion, including industries related to the S-curve, he added.
It is believed that if various situations stabilise, and there are no significant external shocks or broad expansions, the Thai stock market is likely to recover more quickly than other regional markets, even though it experienced a more substantial decrease today, Pakorn said.
