SET plunges on Greek debt woes
The Stock Exchange of Thailand has lost nearly 10 per cent, on fears that Greece may be let to default on its massive debts and leave the euro zone.
Market jitteries heightened in the afternoon, as computer glitches led to a brief stop in trading. Investors were briefly convinced that the market lost as much as 10 per cent, and that the loss triggered the circuit breaker.
The glitches took place 5 minutes after the afternoon trading started. At the time, the SET index lost 9.42 per cent to 867.94 points. SET said in a statement that the circuit breaker was not turned on at 2.46pm.
The market nosedived nearly 9 per cent in the morning session. The Stock Exchange of Thailand lost grounds, with the composite index plummeting to 877.08 points or over 8 per cent before a rebound. At midday, the index ended at 883.23 points, down 7.82 per cent, on turnover of Bt24.81 billion.
The rumours were originated on a string of bad news following the International Monetary Fund's meeting last weekend. Group of 20 then showed worries over the absence of solution to ease the European debt crisis. Big-time investor George Soros also mentioned that the world is slipping into recession and the euro zone debt crisis is now more severe than the US economic malaise. The most frightening news came from International Monetary Fund Managing Director Christine Lagarde, who said that the fund's $384 billion lending chest may not be enough to meet all loan requests if the global economy worsens.
IMF today said in a statement that Lagarde met with Greece's Finance Minister Evangelos Venizelos today in Washington. They discussed the terms under which the IMF mission would return to Athens to undertake the fifth review of Greece's economic programme -- most likely this coming week.
German Chancellor Angela Merkel on Saturday also defended her government's part in international efforts to save Greece, this time from default against internal criticism from her party.
Foreign investors have remained net-sellers in the Thai market so far this month, with combined sale outpacing purchases by Bt15.8 billion. It accounted for nearly half of Bt34.69 billion foreign net-sell so far this year.
