Most stock exchanges across Asia rallied yesterday, with the Stock Exchange of Thailand (SET) index gaining 0.76%, buoyed by the US's announcement to delay punitive tariffs on Chinese exports.
The US is delaying a planned increase of tariffs on more than US$200 billion in Chinese exports after both sides hailed "substantial progress" made in trade talks, reported AFP.
US President Donald Trump said he planned to hold a summit with China's president at his Florida estate to ink a deal.
Such positive bilateral trade negotiations led to investors' upbeat sentiment, with China's Shanghai SE Composite index rising the most by 5.6%.
On the domestic front, the SET index closed at 1,671.75 points, up 12.55 points, in turnover worth 56.7 billion baht. Institutional investors and brokerage firms were net buyers of shares worth 3.1 billion and 236 million baht, respectively.
"I expect the situation surrounding the Sino-US trade war will be better from this point forward," said SCB Securities senior vice-president Pornthep Jubandhu.
Foreign capital should return to emerging markets including Thailand, said Mr Pornthep.
Thailand's upcoming general election also provides support in boosting private consumption, he said.
"Even though sentiment between the US and China is improving, Thai exports will not recover suddenly. Trade will take around six months to see a tangible impact, with the services sector being affected the most right now," said Mr Pornthep.
Market participants are closely observing two factors: the US's planned tariffs on imported automobiles and the US's trade deficit with China, he said.
An analyst from DBS Vickers Securities Thailand, speaking on condition of anonymity, said the SET's positive momentum came from the fruitful trade negotiations and the US Federal Reserve pausing its interest rate normalisation, stopping the reduction of its balance sheet until the end of this year.
But negotiations on Brexit, domestic political uncertainty and fourth-quarter earnings of SET-listed firms are still keeping a lid on investor confidence, said the analyst. Fourth-quarter performance and dividend payments are the factors to watch.