Stock investor confidence hit a five-month high in October, propelled by the government's recent launches of economic stimulus to add money to low-income earners' pockets and help small and medium-sized business operators gain better access to borrowing sources.
The Fetco Nida Investor Confidence Index for the final quarter surged to 101.48, up 70.4% from 59.57 in the previous survey, said Voravan Tarapoom, chairwoman of the Federation of Thai Capital Market Organizations (Fetco).
All types of investors had more optimistic views of the Thai stock market, particularly institutional investors, she said, adding that the sub-index on institutional investors' confidence jumped to a seven-month high to 99.99 or an 88.9% increase.
Foreign investors' confidence improved the least at 66.7% to 66.7.
According to the confidence measurement, a figure lower than 80 is bearish, 80-120 is neutral and more than 120 is bullish.
The survey also found that construction is the most attractive sector for investors on expectations that they will reap benefit from accelerating public investment, while the steel sector is the least interesting.
Voravan: Institutional investors upbeat
Global economic conditions appear to be the biggest headwind. Others are China's economic uncertainties, the US Federal Reserve looming interest rate hike and both domestic and overseas political conflicts.
Tourism's recovery and rising demand for long-term equity funds and retirement mutual funds are also helping the Thai stock market.
Kasikorn Securities executive chairman Thiti Tantikulanan said Thailand's economy had already bottomed out but was still engulfed by risk factors including China's cooling economy, currency depreciation of emerging markets, the potential US rate rise and increasing threats to the global economy.
As Thailand's economic restructuring relies heavily on exports, the fragile global economy would make the country's growth lower than its potential for a while, he said.
Kasikorn forecasts that the SET index will rise to 1,450 points this year and 1,600 in 2016.
Meanwhile, SCB Securities projects the SET index will climb to 1,450 points this year before rising to 1,800 next year.
External factors will cause the Thai bourse to be volatile throughout this year, senior vice-president Isara Ordeedolchest said.
Capital flight would be seen in the short term after a Fed rate increase but the country's sound fundamentals and infrastructure investment would draw investors back eventually, he said.