Thai shares joined a global equity sell-off yesterday, tumbling 1.65% amid mounting nervousness over a possible British exit from the European Union as the vote looms.
The SET index started the day on a sour note and sales intensified in the late morning session, tracking the Asian equity rout.
The benchmark index closed at 1,411.19 points after heavy trade worth 46.8 billion baht.
Bank, energy and telecom blue chips dragged the Thai stock market down. Advanced Info Service Plc (ADVANC) dipped 6.50 baht to 156 baht, national oil and gas conglomerate PTT Plc slipped 6 baht to 313 baht, Siam Commercial Bank (SCB) fell 3 baht to 132 baht, PTT Exploration and Production Plc (PTTEP) decreased 2.25 baht to 80.75 baht and Kasikornbank (KBANK) slid 5 baht to 162.50 baht.
US Federal Reserve chairwoman Janet Yellen's comment that uncertainties over Britain's exit or "Brexit" from the 28-nation EU discouraged the central bank from increasing its interest rate at Wednesday's meeting also clouded sentiment for risk assets.
Gold also hit a six-week high, climbing for the sixth straight session as investors continued their risk-averse mode. The precious metal price topped US$1,300 an ounce for the first time in six weeks.
Institutional and foreign investors and brokers respectively yanked 3.2 billion baht, 967 million and 1.22 billion out of the Thai bourse yesterday, while retail investors were net buyers of 5.39 billion baht.
The Japanese stock market was Asia's biggest loser yesterday as the safe-haven yen surged against the US dollar after the Bank of Japan held off from injecting more stimulus to its economy.
The Nikkei Stock Average 225 dived 3.05%, Hong Kong's Hang Seng index sank 2.1%, Taiwan's Taiex index dipped 1.3% and South Korea's Kospi index plunged 0.86%.
European stock markets also suffered a broad sell-off in early trading.
Kasikorn Securities' assistant managing director Kavee Chukitkasem said recent opinion polls that suggested British voters were evenly split on whether to stay in or leave the EU at next Thursday's referendum had shaken investors' confidence and forced them to flee to safe havens such as gold, yen and the US dollar.
"The Thai stock market suffered at a lower magnitude than some Asian bourses as foreign investors had previously dumped Thai shares," he said.
Concerns over the impact of a possible Brexit vote could still hit the Thai stock market in the short run, but even a British vote to leave the EU would not have any effect on Thailand's economic fundamentals as the country's trade with Britain is minimal, Mr Kavee said.
The Thai capital market could bounce back rapidly after uncertainties over Brexit receded, he said.
The Bank of England has warned that the pound could fall after a Brexit vote.