The Thai stock market is expected to continue growing next month, supported by easing global trade tension, a downward trend for global interest rates, and inflows into Thai ESG Extra (ESG X) funds, says the Stock Exchange of Thailand (SET).
Soraphol Tulayasathien, senior executive vice-president, said the SET is projected to perform better next month after soaring 7.06% month-to-date. The Thai index has contracted 13.3% for the year.
There are several supportive factors, including easing global tensions, that have attracted fund inflows into both Thai bonds and equities, he said.
The new Thai ESG X funds and the expected rollout of government stimulus should also lift the SET, said Mr Soraphol.
Excluding energy stocks, which were affected by the global economic slowdown, other listed companies are anticipated to report improved first-quarter financial results year-on-year, he said.
Investors are selling US treasuries, formerly considered safe-haven assets, on concerns the US economy may be affected by ongoing trade wars, said Mr Soraphol.
The Federal Reserve recently maintained the benchmark interest rate at 4.25-4.5% as expected, marking the third consecutive rate pause.
The Thai Bond Market Association reported net foreign inflows of 60 billion baht into the Thai bond market last month, the highest level since February 2022. Analysts attribute this to declining confidence in the dollar, rising demand for safe-haven assets, and expectations of lower Thai interest rates amid weaker domestic economic growth.
The Thai stock market has shown signs of stabilisation.
On April 10, the US announced a 90-day delay in the implementation of reciprocal tariffs, while measures introduced by the SET from April 8-11 helped stabilise Thailand's capital markets.
As a consequence, the SET index has been less volatile than many other regional bourses. Since April 16, the bourse has gradually increased, gaining across various sectors, while Thai stock valuations remain attractive, said Mr Soraphol.
At the end of last month, the SET finished at 1,197.26 points, up 3.4% from the previous month, outperforming most regional markets. Sectors that outperformed the overall index compared with the end of 2024 include finance, agriculture and food, resources, and consumer products.
The average daily trading value of the SET and the Market for Alternative Investment (MAI) was 39.4 billion baht in April, down 11.3% from the previous month.
Foreign investors continued to dominate trading activity, accounting for 50.5% of total trading value, the highest among all investor categories. However, they registered a net selling position of 14.6 billion baht.
Two new companies floated shares on the MAI in April: LTMH and Bangkok Asset Intergroup (BKA).
The forward price-to-earnings (P/E) ratio of the Thai market as of April was 13 times, higher than the Asian average of 11.5 times.
The historical P/E ratio was 15.8 times, exceeding the Asian market's average of 11.4 times. The dividend yield ratio was 4% at the end of last month, higher than the Asian bourses' average of 3.4%.