SET expects foreigners to return after net-selling in first 11 months
Foreign investors have jettisoned a net US$555 million (Bt17.3 billion) of Thai stocks from January-November, but could stage a comeback, given the market's low prices and high dividend yields, a Stock Exchange of Thailand executive said yesterday.
Tientip Subhanij, director of the SET’s Capital Market Research Institute, said foreign investors sold Thai stocks worth a net $406 million in November alone. This was less than net foreign selling of Taiwanese stocks worth $10.46 billion, South Korean stocks worth $5.45 billion and Indian stocks worth $635 million.
At the end of November, the SET Index closed at 995.33 points, down 3.62 per cent from the end of last year and in line with most of its regional peers.
More than 100 companies, or 20 per cent of total listed companies, were affected by the floods, she said. Of them, 30 companies, representing 1.28 per cent of total market capitalisation, were severely affected.
The local stock market is expected to attract foreign investors next year because of its low forward price-to-earnings ratio and higher dividend yield, compared with US and European bourses.
This month, foreign investors returned with net buys of Bt9.3 billion, indicating their renewed interest.
The stock market here depends mainly on the global economy. Europeans account for 40 per cent of total foreign holdings in the Thai stock market, followed by Singaporean and US investors.
“The European debt problem could be a major factor for the Thai stock market if it is not eased soon. However, the local factors could also play a vital role in next year’s expected economic recovery, namely measures for the restoration of investor confidence, policy continuity and Thailand’s long-term investment plan,” Tientip said.
