Thai stock market ‘bullish’ thanks to stimulus, political stability
SET to stay in positive territory for next three months asw confidence surges across investor groups with FETCO index rising to 132.51 points
Investors expect the Thai stock market to turn “bullish” over the next three months thanks mainly to the upcoming stimulus measures and political stability under the new premier and her Cabinet.
Kobsak Pootrakool, chairman of the Federation of Thai Capital Market Organisations (FETCO), said the federation has conducted its monthly investor confidence index from August 20 to 31 and found that the index for the next three months stands at 132.51 points, which is within the “bullish zone”.
He said investors see the new government’s economic stimulus measures as the most important factor to boost their confidence in the Stock Exchange of Thailand, in addition to reviving the domestic economy and positive signs of political clarity.
The factors that worry investors the most are political uncertainty, economic regression and inflation.
Meanwhile, the highlights of the FETCO Investor Confidence Index as of August are:
- FETCO Investor Confidence Index from now until November lies in the “bullish” zone at 132.51 (FETCO ICI Criterion sets “bullish” at 120-159)
- Confidence of retail, proprietary and institutional investors as well as foreign investors is in a “very bullish” zone
- Commercial (COMM) is the most attractive sector
- Automotive (AUTO) is the least attractive sector
- The government’s stimulus measures are the most influential factors driving the Thai stock market
- Political uncertainty is the most important factor impeding the Thai stock market
Kobsak said the August survey learned that the confidence of retail investors had risen 73.6% to 144.26, while that of proprietary traders rose by 28.4% to 144.44.
Meanwhile, institutional investors' confidence rose 32% to 120 and foreign investors rose 275% to 125.
Kobsak noted that the SET index had dropped by 1,300 points in the first half of August due to political uncertainty after the dissolution of the Move Forward Party and the removal of prime minister Srettha Thavisin from office by the Constitutional Court.
However, the second half of August saw the SET index rise and close at 1,359.07 points at the end of the month, which was 2.9% higher than the previous month. The market sentiment improved after the prime minister's appointment and affirmation that her government would continue with economic stimulus measures.
The market sentiment, in particular, was boosted after the announcement that the government will hand out 10,000 baht to 14 million vulnerable people or state welfare card holders before other recipients, Kobsak added.
