Thai Stocks Plunge on US Tariff Fears and Oil Price Slump

The Thai stock market experienced a sharp sell-off in early trading on Tuesday, plummeting 50 points – nearly 5% – as anticipated in response to US President Donald Trump's latest tariff impositions following China's retaliation, marking a new low for the year.

Heightened concerns over a potential full-blown trade war, compounded by crude oil prices plummeting to a four-year low, triggered heavy selling pressure across major blue-chip stocks, particularly in the banking and energy sectors.

The Stock Exchange of Thailand (SET) Index closed the morning session down 47.73 points, or 4.24%, at 1,077.48, dragged lower by the spectre of US tariffs and mounting fears of a global trade conflict.

Analysts noted that the over 50-point drop at the market open was more pronounced than expected, effectively catching up with the significant falls seen in global markets during yesterday's Thai market holiday.

The global downturn has been fuelled by anxieties surrounding President Trump's tariff policies following China's retaliatory measures, escalating the risk of a damaging trade war with global economic ramifications.

Adding to the negative sentiment, the dramatic slide in crude oil prices to their lowest point in four years presents a downside risk to the Thai economy and the earnings outlook for listed companies.

Despite the Stock Exchange of Thailand's (SET) introduction of temporary volatility dampening measures, including adjusted ceiling and floor limits and a ban on short selling, the overall index trend is perceived as sideways to downwards.

Opportunities for bargain hunting ("bottom fishing") might emerge, and a potential rebound could occur if President Trump initiates tariff negotiations with any nation, even if not Thailand directly.

However, the Thai bourse's morning performance stood in stark contrast to the generally positive trend observed in Asian markets, which closed the morning session higher on Tuesday.

These regional markets were recovering from substantial losses the previous day, amidst widespread apprehension regarding the impact of President Trump's tariff policies and his threats of further tariff hikes against China.

Japan's Nikkei index closed the morning session at 33,030.66 points, a significant gain of 1,894.08 points or 6.08%. Hong Kong's Hang Seng index finished the morning at 20,140.78 points, up 312.48 points or 1.58%, and the Shanghai Composite in China closed at 3,124.77 points, a rise of 28.20 points or 0.91%.

Elsewhere in the region, Australia's S&P/ASX 200 index surged by 1.85%, and South Korea's KOSPI index climbed by 0.44%.

Investors remain keenly focused on the unfolding trade war implications following President Trump's announcement of retaliatory and baseline tariffs on Wednesday, April 2nd.

The retaliatory tariffs, ranging from 10% to 49% depending on the target country's tariffs and non-tariff barriers on US imports, are set to take effect on April 9th. The baseline tariff is a uniform 10% for all countries and came into force on April 5th.

The US President's imposition of a 34% tariff on Chinese imports prompted Beijing to announce reciprocal tariffs of the same magnitude on US goods.

In the latest development, President Trump has reportedly given the Chinese government until Tuesday, April 8th, to dismantle its 34% tariffs on US imports, failing which China will face an additional 50% in US tariffs.