Thai shares extended a losing streak for the third trading day yesterday, sinking 2.1% on worries over the recent nosedive in the global oil price.
Analysts warn the local bourse is likely to slip below the 1,500-point barrier.
The Stock Exchange of Thailand (SET) index emerged as Asia's worst performer yesterday as it caught up with a global stock market rout that occurred on Wednesday, when the Thai market was closed for Constitution Day.
The main gauge tumbled sharply since the opening bell and dived further to the day's trough of 1,508.24 points, a 51.32-point or 3.29% retreat, before buying on dip in late trade helped to pare some losses to close the market at 1,526.81.
Heavy-weighed PTT Plc and its group remained at the centre of the sell-off.
PTT tumbled 3.48% to 333 baht, PTT Exploration and Production (PTTEP) 5.74% to 115 baht, PTT Global Chemical (PTTGC) 4.04% to 53.50 baht, Thai Oil (TOP) 2.84% to 42.75 baht and Bangchak Petroleum (BCP) 3.03% to 32 baht.
Over three straight trading days, Thai shares plummeted 4.44% with 656 billion baht in market capitalisation wiped out.
After meeting with Finance Minister Sommai Phasee about the stock market's tailspin, SET chairman Sathit Limpongpan said it was only normal for the SET index to track the global sell-off after the oil price hit a five-year low of about US$60 a barrel.
"The Thai economy is still expected to improve next year," he said.
SET president Kesara Manchusree said the sharp fall in the oil price had weighed on the performance of oil-related stocks, as they had a significant weighting on the Thai stock market.
"Investors should not focus on the SET failing to stay above 1,600 points. They should consider that listed companies' revenue during the first nine months rose by 20% year-on-year, reflecting their business ability," she said.
Pattera Dilokrungthirapop, chairwoman of the Association of Securities Companies, said the oil price slump hurt the Thai stock market, where energy shares' weighting was substantial.
Investors also took the opportunity to adjust their portfolio ahead of year-end, she said.
"In my opinion, volatility in the equities market will continue in the short term, but the SET index won't drop below its tough support level of 1,500 points," Ms Pattera said.
However, Kriengkrai Tumnutud, head strategist at AEC Securities Plc, warned the SET index could fall below 1,500 points, although downside risk was limited following the recent sharp fall.