PM blames court cases for SET decline
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PM blames court cases for SET decline

Srettha admits market sentiment is being affected in light of political implications

Prime Minister Srettha Thavisin speaks to reporters after Tuesday's cabinet meeting at Government House. (Photo: Royal Thai Government)
Prime Minister Srettha Thavisin speaks to reporters after Tuesday's cabinet meeting at Government House. (Photo: Royal Thai Government)

Prime Minister Srettha Thavisin on Tuesday admitted that the current political situation could be affecting the stock market, which hit a four-year low on Monday.

Analysts have cited three major court cases that could have ramifications for the Thai political landscape as a major contributor to current investor unease.

“It is about stock market sentiment,” Mr Srettha said, adding that those accused in the three cases, including himself, have to defend themselves in court.

Last Friday, Mr Srettha submitted his defence to the Constitutional Court in a case involving the appointment of Pichit Chuenban as a PM’s Office minister.

Forty caretaker senators earlier asked the court if both men should be removed from office under Section 170 of the charter, which deals with the ethics of cabinet ministers.

Mr Pichit, who served six months behind bars for trying to bribe Supreme Court judges in 2008, resigned days after his appointment. 

The Constitutional Court is also scheduled to consider a dissolution case brought against the opposition Move Forward Party on Wednesday.

And former premier Thaksin Shinawatra is scheduled to report to the attorney general on June 18 so that the indictment process can begin in his lese-majeste case.

On May 29, the attorney general decided to indict Thaksin on lese majeste and computer crime charges arising from an interview given to a Korean newspaper in February 2015.

Thaksin’s lawyers are claiming that investigators handling the original complaint filed against him in 2015 faced intimidation from the military regime of the day.

On Monday, Thai stocks plunged to a four-year low as investors fretted over political uncertainties.

The Stock Exchange of Thailand (SET) Index fell to a low of 1,313.26 points around the close of the morning session at midday, the lowest since March 23, 2020.

InnovestX Securities said the SET Index was expected to be volatile this month because of the court cases.

“Fund outflows will remain a major risk factor for the second half of this year as politics could delay or affect the implementation of government policies to jump-start the economy,” said Sittichai Duangrattanachaya, a senior global equity strategist at the firm.

Foreign investors have been net sellers of 93 billion baht worth of Thai shares so far this year.

An analyst from Finansia Syrus, who spoke on condition of anonymity, said: “The most important case, in our view, is the ruling on the status of Mr Srettha. This is a risk factor for the government’s stability.”

Sanan Angubolkul, chairman of the Thai Chamber of Commerce, said the market slump was caused by several factors, including the political situation, a slow economic recovery and high levels of household debt.

These prompted investors to lose confidence and sell Thai stocks, he said.

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