SET index kicks off new year with a bang

SET index kicks off new year with a bang

Kesara: Performance reflects confidence
Kesara: Performance reflects confidence

The Stock Exchange of Thailand (SET) index rang in the first trading day of the year on an upbeat note, with the gauge posting an all-time closing high of 1,778.53 points, eclipsing the previous record of 1,753.73 set on Jan 4, 1994.

The SET index rose 1.4% on the day in heavy turnover worth 85.85 billion baht. The benchmark climbed at one point to 1,779.55 -- the highest intraday level in almost 24 years.

The intraday record high of 1,789.16 was registered on Jan 5, 1994.

The bourse plunged during the 1997-98 Asian financial crisis, cratering at 214.53 in August 1998.

Foreign investors were net buyers of 2.7 billion baht, with shares worth 2.1 billion purchased by institutional investors. Retail investors, on the other hand, were net sellers of 4.6 billion baht and brokerage firms sold 228.53 billion.

The combined market capitalisation of the SET and the Market for Alternative Investment on Wednesday rose to 18.17 trillion baht, while daily average trading value was 88.08 billion.

The SET rally was led by shares in the energy sector, including GULF (+5.8%), IVL (+4.7%), PTT (+2.3%) and IRPC (+2.1%).

"The index's rise reflects investment confidence in line with economic growth and listed firms' profitability," said SET president Kesara Manchusree. "But it is advisable for investors to select stocks with good performance and growth potential, study companies' information carefully and monitor domestic and global situations that can affect investment, in order to minimise risks."

Thai shares closed on the last trading day of 2017 at 1,753.71, just shy of the all-time closing high, while the benchmark index tallied an annual gain of 13.7%.

The SET's dividend yield registered 2.7% last year, down from 3.04% in 2016. The market's price-to-earnings ratio stood at 19.1 at year-end 2017, compared with 18.6 a year earlier.

Foreigners have returned to investing in the Thai bourse and beyond, thanks to the global economic recovery, particularly in China and the US, said Monthol Junchaya, chief investment officer at One Asset Management.

The purchasing managers indices of China and the US are surpassing market expectations, Mr Monthol said.

Stocks with growth potential are those in the automotive, export and consumption sectors, he said, adding that stock performance in consumption, banking, energy and petrochemicals has improved since last year's final quarter.

"Despite [recent] sales of long-term equity funds and retirement mutual funds, good market sentiment will prompt investors to increasingly purchase equities," Mr Monthol said.

Apichai Raomanachai, deputy managing director for research at Apple Wealth Securities, said fund inflows are expected to channel into the SET, propelled by Thailand's positive economic growth outlook and improved earnings among listed companies.

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