SET almost at 1,500

The SET index came within a hair of 1,500 for the first time in more than 18 years as the bull run in Thai stocks continued on Friday.

The Stock Exchange of Thailand Index gained 25.02 points or 1.7% to close at 1,499.22, also its highest point of the day, after shedding 1.1% on Thursday as investors took profits.

The last time the SET closed above 1,500 was on Nov 7, 1994 when it reached 1,504.15. The market reached its all-time high of 1,789.16 on Jan 5, 1994.

Friday's closing was an increase of 2.6% from 1,461.41 a week earlier. Turnover was 58.5 billion baht, with 20.8 billion shares traded.

The market began February with a bang after gaining 7.1% in January from the end of 2012. Market capitalisation as of Jan 31 was 12.5 trillion baht, compared with 11.83 billion at the end of 2012.

The overall market is now trading at a price/earnings ratio of 19.3 times, suggesting Thai shares are no longer a bargain. Speculation by small investors has also become a growing concern.

Exchange officials said on Thursday that they were monitoring about 60 companies with P/E ratios of 40 times or more, as retail investors continue to chase shares of small-cap companies in hopes of making a quick killing.

Analysts also warned about possible heavy selling next week as investors take profits ahead of Chinese New Year, when markets in China, Taiwan, Hong Kong and Vietnam will close for several days.

Foreign investors were net buyers on Friday of 977.8 million baht worth of Thai shares. Local institutions were net buyers of 1.99 billion baht and brokers bought 1.21 billion. Individual investors were net sellers of 4.17 billion baht. 

For the year to date, foreign investors have bought 16 billion baht more in Thai shares than they have sold. They account for 20% of total turnover on the SET, which has averaged more than 50 billion baht since the start of the year, compared with about 32 billion in 2012.

World stock markets were mostly higher on Friday, fuelled by Wall Street's strong performance for January, as investors waited for US employment figures expected to show steady job growth.

Economists estimated the economy added 155,000 jobs in January and that the unemployment rate stayed at 7.8% for a third straight month. That would help the economy grow after it shrank at an annual rate of 0.1% in the final quarter of 2012.

Britain's FTSE 100 rose 0.3% in early trading. Germany's DAX advanced 0.3% and France's CAC-40 added 0.2% to 3,740.20. Wall Street futures were higher ahead of the new York market opening.

Although the Dow finished lower on Thursday, the index logged its best January since 1994 by finishing 5.8% higher for the month. The Standard & Poor's 500 finished the month 5% higher, its best start to the year since 1997.

Asian stocks were mixed after manufacturing data from China fell short of expectations. Industrial production is still growing, but at a slower pace, according to the China Federation of Logistics and Purchasing. Its manufacturing index for January fell to 50.4 from 50.6 in December on a 100-point scale in which numbers above 50 indicate expansion.

Hong Kong's Hang Seng fell to 23,721.84. South Korea's Kospi dropped 0.2% to 1,957.79. Australia's S&P/ASX 200 gained 0.9% to 4,921.10.

Japan's Nikkei 225, meanwhile, was once again energised by the yen's continued descent against the dollar. The index rose 0.5% to 11,191.34.

In Bangkok, the SET50 index of blue chips ended at 1,005.09 points, up 16.88 points, with total trade value of 35.57 billion baht. The SETHD index of high-dividend shares rose 27.68 points to 1,302.24, with turnover of 14.4 billion baht. The Market for Alternative Investment gained 1.91 points to 455.05, with transaction value of 3.43 billion baht.

The most active shares by value were PTT, rising 13 baht or 3.8% to 354 baht; and TRUE, up 20 satang to 6.80 baht.

In third place was the distribution company Berli Jucker Plc (BJC), controlled by billionaire Charoen Sirivadhanabhakdi, who has just taken over the Singapore conglomerate Fraser & Neave. BJC shares rose 10.7% to 83 baht on speculation that it would benefit from the F&N deal as well.

Fourth and fifth on the turnover list were KBANK, up 6.50 to 205 baht; and PTTEP, up 2.50 to 168.50 baht.

In the currency markets, the baht was little changed on the day but up 0.3% on the week as foreign investors continued to pile into Thai stocks and bonds.

Global funds had bought $92 million more in sovereign bonds than they sold in the week through Thursday, Thai Bond Market Association data show.

The Bank of Thailand on Thursday reported that exports increased 14% in December and the country posted a current-account surplus of $730 million.

The baht rebounded from a one-week low of 30.01 reached on Monday amid speculation that exporters are repatriating proceeds to take advantage of the currency's decline.

"The trend of fund inflows into Thailand remains intact," said Kozo Hasegawa, a foreign-exchange trader at Sumitomo Mitsui Banking Corp in Bangkok. "There seems to be some exporter demand for the baht near the 30 level."

Finance Minister Kittiratt Na-Ranong on Thursday said people were concerned the strong baht may hurt tourism and exports.

The baht was trading late Friday in Bangkok at 29.78/81 to the dollar, compared with 29.81/83 on Thursday and 29.90/92 a week earlier.

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