Thai shares hit 18-month low
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Thai shares plummeted by as much as 4.73 per cent on Monday, as concerns on China's economic slowdown sparked global sell-off.
At noon, the Stock Exchange of Thailand index plunged by 52.43 points to 1,313.18 points, with turnover of Bt32.8 billion. The nosedive followed a depressive week, as Bangkok was rattled by the deadly bombing.
It closed at 1,301.06 points, losing 64.55 points or 4.73 per cent, on turnover of Bt60.5 billion.
At this level, the index was at an18-month low. Foreign net-sell continued today, with the value worth Bt4.78 billion. The month-to-date net-sells reached Bt33.96 billion.
According to NOW Channel, four mutual fund companies are reportedly revising downward the end-2015 SET index target. From the range of 1,550-1,620 points, they see the likelihood that the index may move in the range of 1,400-1457 points.
In its research note, Tisco Securities expected a continued slide today. Yet, it hoped that the new economic team which started working today as well as the National Reform Council's passage of the charter draft should allow the Thai market to perform better than other markets.
China's slowdown has hit commodity prices. Oil prices are tipped to fall below US$40 per barrel.
"The Thai market should further slide this week, with the new support level at 1,300 points, on worries on China's economic slowdown and its ramifications to the global economy. Meanwhile, the Thai domestic economy has shrunk beyond expectation and this will need a sizeable stimulus package that contains both short- and long-term measures," said KT-Zmico Securities in a note.
Share prices across Asia were being hammered on Monday, led by Shanghai which plunged 8.49 per cent - the sharpest one-day fall.
Other markets also suffered.
Hong Kong down 5.17 per cent to 21,251.57 - its lowest point since May 2014
Philippine down 6.7 per cent
Tokyo down 4.61 per cent to 18,540.68 points, its lowest since February
Australia down 3.9 per cent to a two-year low
All European bourses opened lower today.
This followed a sharp loss in US and European stocks on Friday, on a combination of bad news that ranged from deepening worries about China's economy, the European economy sputtering as Greece calls for a new election, to the unclear date for the timing of US rate hikes.
China has been a key driver of global growth in the last 10 years. The International Monetary Fund has forecast China's growth at 6.8 per cent this year - compared with 7.4 per cent in 2014 - but many analysts have doubts about official Chinese figures. The yuan devaluation has led to fears that the economy could be performing worse than expected.
"The recovery in the US and, to a lesser extent, the euro area and Japan will be offset by the ongoing slowdown in China, low or negative growth in Latin America and only a gradual Russian recovery from its recession this year," Marie Diron, senior vice president for credit policy at Moody's, said in a note.
"Uncertainties over China's slowdown have escalated," banking giant Citi Group said in a note, predicting that growth in the world's second-biggest economy "is likely to remain sluggish."
