The Stock Exchange of Thailand slipped on Monday with Asian bourses broadly down, as investors trimmed risks following a drop in US equity futures, while analysts raised concerns about financial sector stress, saying recession fears are growing.
Most Asian markets closed lower in a week packed with economic data and central bank meetings. China's Shenzhen Component led losses, falling 1.16%, while the Shanghai Composite was down 0.78%. Hong Kong's Hang Seng index fell 0.58%, with South Korea's Kospi losing 0.82%.
Only Japan's Nikkei 225 bucked the regional trend, edging up 0.10% along with a 0.11% rise in the Topix, as investors await the Bank of Japan's monetary policy decision later this week in the first such meeting chaired by its new chief Kazuo Ueda.
The regional drop followed extended losses of US futures with both the S&P 500 and Nasdaq falling 0.4% ahead of a busy week of earnings.
The SET edged down 0.03% on Monday to finish at 1,557.87 points, with major banks leading the losses after revealing their first-quarter financial results last week. State-owned Krungthai Bank (KTB) dropped 1.10%, Kasikorn Bank (KBANK) was down 0.49% and Siam Commercial Bank fell 0.78%.
Kampon Adireksombat, Siam Commercial Bank's first senior vice-president and head of the SCB Chief Investment Office (SCB CIO), warned of rising concerns over a recession due to US and European financial sector stress on top of higher interest rates.
"Banks in the US and Europe are tightening their already stringent lending standards in response to the current financial sector stress, which will likely have a chilling effect on the economic and commercial rebound," Mr Kampon said.
The International Monetary Fund recently forecast that the falling lending trend, coupled with the impact of interest rates, is expected to have a negative impact on the economic growth of both regions, resulting in a GDP decline of about 0.4% each.
"The SCB CIO anticipates an increase in concerns regarding a potential recession throughout the rest of 2023," Mr Kampon pointed out.
While China remains the primary driving force behind the global economic recovery, the first quarter's GDP growth of 4.5% year-to-year indicates an uneven recovery.
