Looser monetary policies worldwide and the protracted Sino-US trade dispute will chiefly determine the second-half investment outlook, according to SCB Wealth Holistic Experts.
Despite a recent truce made by the US and Chinese presidents at the G20 summit, the US-China trade spat is not expected to end soon and US President Donald Trump is likely to use the dispute as a political tool to enhance his popularity before the 2020 presidential election, said Sornchai Suneta, executive vice-president of SCB CIO Office.
Mr Trump made a recent threat to impose additional tariffs on Chinese imports if a deal brokered with China fails.
Global central banks are poised to embark on loosened monetary policies to shore up economic growth momentum while maintaining policy space to prevent adverse effects on foreign exchange rates, Mr Sornchai said.
The US Federal Reserve is expected to cut its policy rate twice this year in order to hedge against a possible recession, he said.
For Thailand’s stock market outlook, offshore fund flows are expected to continue moving into the country’s capital market as confidence is boosted by clearer domestic politics after the new government took office, said SCB Securities (SCBS) managing director Sukit Udomsirikul.
The local stock market is regarded as having a low risk of exposure to the Sino-US trade dispute, he said, while forecast adjustments of SET-listed companies’ net profit are drawing to a close.
The Stock Exchange of Thailand index is projected to move in a range of 1,700-1,750 points in the second half based on a GDP growth forecast of 3.1% this year, according to SCBS.