The share market remains bullish as a result of capital inflows, with the Stock Exchange of Thailand (SET) forecast to exceed 1,600 points after a correction in March and April, say analysts.
The market is expected to decline by 7-8% from March-April before rebounding as concerns over the US debt ceiling expansion have eased, analysts told a seminar on the direction of Thai stocks this year organised by the SET yesterday.
Wikij Tirawannarat, a first vice-president at Bualuang Securities, said his company revised its SET forecast target to 1,640 points from 1,550 due to higher fund inflows and fundamental support.
However, he cautioned investors that the SET is at great risk of a sharp dip because of profit-taking.
"The SET will have a correction of about 100 points over the next two months, with foreign investors seeing a profit of 6-8% and a foreign exchange gain of 2-3%, leading to profit-taking before a new rally begins," he said.
Thai shares gained 0.95% yesterday to close at 1,546.64 points in heavy trade worth 63.1 billion baht, with the key factor the policy interest rate staying unchanged at 2.75% on concerns of inflation.
The rate remains quite attractive for foreign investors, said Mr Wikij.
He said cheap banking stocks will be the focus as well as companies that plan to launch infrastructure and property funds.
The emphasis in the first half will be listed companies that will benefit from government projects and local consumption, while the second half should witness more of a focus on stocks with global products such as gas and coal, he added.
Rakpong Chaisuparakul, a strategist at KGI Securities, said about 65% of Thai listed firms announced their first-quarter results in line with expectations, with many of them actually beating projections.
This led the company to increase its SET forecast from 1,550 to 1,680 points this year.
He said some small- and medium-cap stocks still have high growth even though they are more volatile than large-cap stocks.
Kesara Manchusree, an SET executive vice-president, said the bourse will list the ThaiDEX SET100 ETF, managed by One Asset Management Ltd, on its main board today under the ticker symbol TH100.
KGI Securities and BLS are participating dealers, while KGI is also a market maker. The TH100 had an IPO price of 4.429 baht a unit and a total size of 372 million baht.