SET sheds B4.6tn in market cap during Q1

SET sheds B4.6tn in market cap during Q1

An electronic board displays stock prices at a brokerage. (Photo by Pornprom Satrabhaya)
An electronic board displays stock prices at a brokerage. (Photo by Pornprom Satrabhaya)

About 4.6 trillion baht worth of market capitalisation was wiped off the Stock Exchange of Thailand (SET) in the first quarter as the sell-off gained momentum from coronavirus fears.

The SET's market cap fell from 16.75 trillion baht at year-end 2019 to 12.1 trillion baht at the end of March.

With such a massive equity offloading, the bourse tumbled 28.7% during the first three months of 2020, making it one of the world's worst-performing stock markets.

The Market for Alternative Investment's market cap dropped 30%, or 66.4 billion baht, to 149 billion baht in the first quarter.

In the first quarter, the SET index's highest close was 1,600.48, while the lowest was 1,024.46. During intra-day trading hours, the main equity benchmark fell below the 1,000 level to 969.08 on March 13.

Trading on the SET was halted for a second straight day on March 13, as a circuit-breaker was triggered after a 10% plunge. This was the fifth time in history for a circuit-breaker to be activated to curb excessive volatility in Thailand's equity market, coming right after March 12, when pandemic panic and plunging crude prices triggered the fourth-ever halt.

The circuit-breaker was set off for the first time in 2006, when the Bank of Thailand temporarily imposed capital controls. The second and third triggers occurred on Oct 10 and 27, 2008 during the subprime crisis.

Two consecutive days of panic-selling that triggered a circuit-breaker made the SET temporarily revise securities trading regulations for triggering a circuit-breaker and the ceiling and floor limits for securities products in a bid to curb a heavy stock plunge.

Despite the revisions, another circuit-breaker occurred on March 23 as the Bank of Thailand's monetary easing and a soft lockdown in Bangkok did little to lift depressed sentiment.

The most impacted sectors as of March 31 were petrochemicals, whose market cap fell by 42.2% year-to-date to 318.87 billion baht, followed by the banking sector (-39.2%), tourism (-34.7%) and energy (-33%).

Commerce was the least affected sector, its market cap falling 9% to 1.36 trillion baht, with the ICT sector identified as the second least affected with a 13.7% decline.

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