Thai stocks advanced slightly on Friday amid growing optimism about global economic conditions and after the Bank of Thailand raised domestic growth forecasts for this year and next.
The Stock Exchange of Thailand Index rose 4.69 points to close at 1,358.50, up 1.7% from the previous Friday's close of 1,334.95. Turnover was 37.27 billion baht, with 17.4 billion shares traded.
Foreign investors were net buyers on Friday of 831.26 million baht worth of Thai shares and local brokers bought 546.44 million. Local institutions were net sellers of 101.77 million baht and individual investors sold 1.27 billion baht more in shares than they bought.
The central bank said that healthy domestic consumption and investment continued to support Thai economic expansion.
Gross domestic product may increase 5.8% in 2012, compared with an earlier prediction of 5.7%, Governor Prasarn Trairatvorakul said. The economy may expand 4.7% next year, higher than the previous 4.6% projection, he added.
"Our exports have shown improvement as the global economy has bottomed out," Dr Prasarn said. "We expect the exports to recover in the first half and will really grow in the second half."
World stock markets swung higher after a survey showed an improvement in China's manufacturing, offsetting gloom from a sharp drop in Japanese business confidence.
European stocks were up in early trade on the heels of two crucial agreements reached on Thursday by EU finance ministers: a compromise to create a single supervisor for banks and an agreement to give Greece desperately needed bailout funds.
HSBC released its preliminary China Purchasing Managers Index for December, which rose to a 14-month high of 50.9. That was an improvement from November's reading of 50.5. Numbers above 50 represent expansion of manufacturing.
Hong Kong's Hang Seng pulled out of negative territory to advance 0.7% to 22,605.9. Mainland Chinese shares posted sharp gains, with the Shanghai Composite Index surging 4.3% to 2,150.63. The Shenzhen Composite Index shot up 4.2% to 816.19.
Japan's Nikkei 225 index sank following the release of a Bank of Japan survey which showed large manufacturers are more pessimistic about business conditions. The "tankan" index for the December quarter dropped from September's -3 to -12, much worse than expected.
The benchmark in Tokyo fell 0.1% to close at 9,737.56. South Korea's Kospi fell 0.4% to 1,995.04. Benchmarks in Indonesia, the Philippines and Taiwan also fell. Australia's S&P/ASX was nearly unchanged at 4,583.10.
In Bangkok, the SET50 index of blue chips ended at 922.86 points, up 2.45 points, with total trade value of 21.9 billion baht. The SETHD index of high-dividend shares rose 1.33 points to 1,200.61, with turnover of 7.72 billion baht. The Market for Alternative Investment fell 0.5 points to 405.37, with transaction value of 1.8 billion baht.
The five most active shares by value were the 7-Eleven operator CP-ALL, up 1.75 baht to 43.75; PTTEP, up 2.50 to 1.59; the Skytrain operator BTS, up 20 satang to 6.70 baht; AirAsia parent AAV, up 24 satang to 4.88 baht; and KBANK, unchanged at 196 baht.
In the bond market, Thai government bonds had a weekly decline, sending the three-year yield to an eight-week high, as signs of a global economic recovery reduce bets for a cut in local interest rates. The baht was little changed.
Growth in factory output and retail sales in China, Thailand's biggest overseas market, accelerated in November, while German investor confidence was at a seven-month high, official data showed this week.
"There's optimism about the global economic recovery, while bets are receding for a Thai rate cut next month," said Kozo Hasegawa, a Bangkok-based foreign-exchange trader at Sumitomo Mitsui Banking Corp. "There's some support from fund inflows for the baht, but we are also seeing some importer demand for the dollar, putting the currency in a relatively tight range."
The yield on the 3.125% bonds due in December 2015 rose five basis points to 2.955% from a week ago.
"The local economy doesn't need more stimulus because the growth momentum is still good," Paiboon Kittisrikangwan, a Bank of Thailand assistant governor, said on Thursday.
The baht was trading late Friday in Bangkok at 30.64 to the dollar, compared with 30.63/67 on Thursday and 30.65/68 a week earlier.