SET up 4.4% to end wild week
- Published: 14/06/2013 at 05:00 PM
- Online news:
Thai stocks rebounded by 4.4% on Friday in line with the Asian trend to end a wild week dominated by uncertainty about the future of US economic stimulus programmes.
The Stock Exchange of Thailand Index rose 62 points to close at 1,465.27, a decrease of 3.3% from the previous Friday's close of 1,516.24. Turnover was 63.89 billion baht, with 9.7 billion shares traded.
The local market, which at one point this year was Asia's second-best performer with a gain of 21%, is now up just 5.3% since the start of the year.
Foreign investors were net buyers on Friday of 147.67 million baht worth of Thai shares. Local institutions were net buyers of 5.51 billion baht. Brokers were net sellers of 2.5 billion baht and individual investors were net sellers of 3.11 billion.
For the year to date, foreign investors have sold 53.6 billion baht more in Thai shares than they have sold, with net sales in June alone of 32 billion baht.
Markets were sent tumbling on Thursday as investors fretted about the end of the huge bond-buying programme put in place by the US Federal Reserve last September, which has fuelled a surge in global stock markets.
That has raised concerns about Japan's own massive stimulus unveiled in April as part of a spending spree by Prime Minister Shinzo Abe aimed at spurring the economy.
But David Herro, chief investment officer for international equities at Harris Associates, told Dow Jones Newswires: "Through all of the recent market volatility, the fundamentals of 'Abenomics' remain in place, and just need time to play out."
Investors also grew nervous after the World Bank on Wednesday cut its global growth forecast as emerging-market economies led by China slow. As well, the Bank of Japan disappointed markets by deciding not to add to its stimulus programme.
However, markets in Asia rebounded on Friday from Tokyo's sharp decline after investors were encouraged by positive US economic news including steady hiring and stronger retail sales, despite mounting signs of weakness in China's economic recovery.
Tokyo's Nikkei 225 gained 1.9% to close at 12,686.52, recovering some of its losses after Thursday's 6.4% plunge that took the index into "bear market" territory.
China's Shanghai Composite gained 0.6% to 2,162.04, following Thursday's 2.8% slide. Hong Kong's Hang Seng gained 0.4% to 20,969.14 and Seoul added 0.4% to 1,889.24. India's Sensex rose 1.6% to 19,126.03.
In early trading in Europe, Britain's FSTE 100 rose 0.5%, France's CAC-40 gained 0.3% and Germany's DAX was up 0.6%.
Markets remain jittery about the possibility that the US Federal Reserve might wind down its stimulus, but were steadied by data showing US retail sales rose 0.6% in May, their strongest showing in six months.
As well, the number of Americans seeking unemployment benefits was smaller than expected last week.
In Bangkok, the SET50 index of blue chips ended at 978.87 points, up 40.61 points, with total trade value of 46.4 billion baht. The SETHD index of high-dividend shares rose 41.39 points to 1,171.27, with turnover of 12.57 billion baht. The Market for Alternative Investment gained 28.75 points to 428.24, with transaction value of 3.7 billion baht.
The five most active shares by value were KBANK, rising 17 baht to 195; INTUCH, up 2.75 to 82.25 baht; ADVANC, up 11 baht to 255; SCB, up 10 baht to 174; and MAKRO, down 2 baht to 772 baht.
In the currency markets, the baht strengthened for a third day as regional equity markets revived.
The baht was trading late Friday in Bangkok at 30.54/60 per dollar, compared with 30.73/79 on Thursday, after crossing 31 earlier, and 30.61/66 a week earlier.
Government bonds rose, pushing the 10-year yield down by the most since July 2012, amid speculation that the Bank of Thailand might have room to cut interest rates again.
"Thai yields have gone up quite a lot and these are quite attractive levels for investors given the fact that the nation has room to cut rates to support growth if necessary," said Tsutomu Soma, manager of fix income at Rakuten Securities in Tokyo
"Risk sentiment is improving slightly on the US [economic] data and recovery in the stock markets."
The yield on the 3.625% bonds due in June 2023 fell 23 basis points to 3.7% in Bangkok, according to data compiled by Bloomberg. The rate rose seven basis points from a week ago and reached 4.01% on June 12, the highest level since September 2011.
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- Writer: Online Reporters
Position: Online Reporters