Escalation of the Middle East war, uncertainty about the US interest rate trend and concerns about third-quarter financial results of local listed companies pressured the Thai stock market to dip by more than 2% on Thursday.
Stock markets globally also dropped heavily as geopolitical anxiety intensified, said Pakorn Peetathawatchai, president of the Stock Exchange of Thailand.
The SET Index has declined 16% for the year to date and is one of the worst performers in the region, but the fundamentals of the Thai stock market remain solid, he added.
He made the comments after the SET closed 2.2% lower at 1,371.22 points on Thursday — the lowest since November 2020 — with trading turnover of 45.69 billion baht.
“Like other markets, the Thai stock market was pressured by external factors,” said Mr Pakorn.
Foreign investors have been net sellers of 170 billion baht worth of Thai stocks for the year to date, compared to their net-buy position of 200 billion baht last year. This group represents around 40-45% of average trading per day.
“Based on our examination, there was no irregular trading today,” said Mr Pakorn. “Short selling is at a normal level of 11.34% and program trading at 36-38% of total market trading.”
He stressed that there had been no direct impact from the Israel-Hamas war on the Thai stock market so far. Many listed Thai firms also have diversified their risk when doing business abroad, even though external markets account for around 40% of their total revenue.
Prime Minister Srettha Thavisin is preparing to lead a roadshow in Singapore next month to restore confidence among regional investors in the Thai stock market.
So far this year, certain groups of stocks have attracted strong interest from investors, among them technology, financial and services companies. Some stocks have been heavily sold off, such as those in the industrial, resources and consumer sectors.
Discussing a possible extension of SET trading hours, Mr Pakorn said the study was still at the public hearing stage and no conclusion has been reached. The results will be announced after the plan is finalised, he said.