SET falls amid renewed trade war fears

SET falls amid renewed trade war fears

The Stock Exchange of Thailand (SET) index opened the week on a bearish note as confidence was dented by the US president's comments and fears of a renewed trade war with China over the origins of Covid-19.

Donald Trump suggested he could put new tariffs on China over its handling of the virus outbreak, claiming he had seen evidence linking a Wuhan lab to the contagion. US Secretary of State Mike Pompeo echoed a similar idea on the virus's origin.

The SET reacted to the news on Tuesday, having been closed for the public holiday on Monday when steep losses were seen across the globe over concerns of another trade standoff between the world's two largest economies, said Nuttachart Mekmasin, vice-president at Trinity Securities.

The SET index ended the morning trading session at 1,283.34 points, down 18.32 points, or -1.4%, in turnover worth 28.6 billion baht.

The SET index is expected to move sideways between 1,150 and 1,350 points in May, with limited upside gains foreseen as a result of the bourse's price-to-earnings ratio at 17.6 times, which is higher than the average of regional stock markets, said Mr Nuttachart.

"Listed firms will fully release their performances in the middle this month, and the market will react to their earnings," he said.

In the past 10 years, the SET index fell in May on eight years, at an average rate of 2.5%, according to Finansia Syrus Securities (FSS).

"The index has reflected all of the positive news and optimism. Since we expect the market to retreat, waiting for new catalysts this year, we recommend our investors gradually trim their portfolios while keeping an eye out for a second wave of the pandemic and on consumer behaviour, which may change," said FSS in its daily focus note.

Thailand's stock market is projected to fall further at the end of June after the SET' s revised equity short-selling and circuit breaker regulations end on June 30, as the measures have helped to reduce the sell-off amount from 5 billion baht to 1 billion on a daily basis, said Mr Nuttachart.

Do you like the content of this article?

Asian markets rise on fresh vaccine hopes

Asian markets rose Monday, recovering some of the losses at the end of last week, as investors followed a strong performance on Wall Street fuelled by hopes for a coronavirus vaccine, though a spike in infections around the world capped gains.


Chinese rivers and lakes swell perilously as summer flood season crests

SHANGHAI: Floods across central and eastern China have left more than 140 people dead or missing and are swelling major rivers and lakes to record-high levels, with authorities warning that the worst was yet to come.


Govt plans B100bn soft loans to help tourism, services

The government plans 100 billion baht of new soft loans to help small-and medium-sized enterprises (SMEs) in the tourist and services sector hit by the coronavirus pandemic, the finance minister said on Monday.