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STOCK MARKET
NUNTAWUN POLKUAMDEE
Thai shares lost 3.38% yesterday as part of a broad regional sell-off over worries about the US economy.
The Stock Exchange of Thailand index, down more than 8% over the past three days, closed down 23.44 points to 669.97, its lowest level since March 2007. Energy stocks dropped 5.16%, banks lost 3.23% and property shed 2.4%.
Foreign investors were net sellers of 3.69 billion baht, while retail investors were net buyers of 2.9 billion and institutions net buyers of 776.18 million.
Analysts said regional and global factors were dominating the market. Concerns were growing that problems at US mortgage finance giants Fannie Mae and Freddie Mac, which together hold around $5 trillion worth of US home loans, could lead to a global crash.
SET president Patareeya Benjapolchai noted that the US financial sector crisis and global inflation were driving investors around the world to exit equities in favour of cash.
But she noted that the SET had in fact fallen less since January than other markets in the region. For the year to date, the SET was down 19.19%, compared with a 20% decline for Singapore, 23.9% for Hong Kong, 33% for the Philippines and 50% for Vietnam.
''Institutional investors are continuing to buy shares, as many fundamental stocks are trading lower than fair prices. I think investors should take the opportunity to accumulate stocks now,'' Mrs Patareeya said.
Wiriya Lappromratana, head of research at Kiatnakin Securities, said over the past eight weeks, foreign investors were net sellers of 74 billion baht worth of securities. Based on purchases over the past two years, another 60 billion baht remained outstanding with foreign investors, she said.
''Basically, if foreign investors continue to sell off shares in the Thai market, the SET index will drop, day-by-day. The next target could be 650 to 660 points, and if foreign investors completely exit, we could drop to 625 points,'' Mrs Wiriya said.
''It's difficult to say what will happen, given regional factors and domestic politics are the main concerns. Thai stocks aren't attractive right now even though the performances of listed companies remain strong.''
Sombat Narawuttichai, the secretary-general of the Securities Analysts Association, said the SAA would cut its SET index target for the year to under 900 points from 927 points now.
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