The Stock Exchange of Thailand (SET) index fell below 1,500 points on Monday as investors continued offloading equity holdings amid mounting fears and death toll of the coronavirus outbreak.
The sell-off was in line with a plunge in most Asian equity indices, with China’s Shanghai SE Composite index plummeting the most by 7.7%.
A sap to investors’ investment appetite continues unabated following a painful week for global markets, with the virus killing 361 people and infecting more than 17,000, and governments around the world banning flights to and from China, according to AFP.
For Thailand, the main equity benchmark closed at the lowest point since November 2016, Bloomberg data showed.
The SET index closed at 1,496.06 points, down 18.08 points or 1.2% from Friday’s closing, in turnover worth 53.2 billion baht.
Concerns over how China's ban on all group tours will damage Thailand’s lucrative tourism industry have compounded the problems faced by the country, which has already been struggling with flagging exports and low private investment.
Tourism is a key driver of the country’s economy, accounting for more than 10% of GDP with revenue streams of almost 2 trillion baht a year over the past few years. Chinese tourists are Thailand's biggest source of foreign visitors.
“Rising fatalities from the novel coronavirus outbreak have spread into the supply chain segments from previous concerns related to the aviation and tourism sectors, with growing concerns over how the virus will deal a blow to global economic growth,” said Mongkol Puangpetra, executive vice-president of strategy research at KTB Securities Thailand.
For instance, shares of CP All Plc, which owns and operates the 7-Eleven convenient store chain, saw a 3.9% decline today as fears have been fanned how retail businesses will suffer considerable losses due to lower Chinese tourist arrivals.
“The novel coronavirus will continue to determine market outlook this week. We will have to see when a turning point on virus containment will transpire,” said Mr Mongkol.
Veeravat Virochpoka, vice-president at Finansia Syrus Securities, said the impact of the coronavirus outbreak on global equity markets has not reached its peak as it normally takes around two months to see an aftermath of a significant event.
