Fund inflows continue to drive Thai market
THE STOCK Exchange of Thailand in the first half of this year outperformed other bourses in Southeast Asia in terms of fund inflows and dividend yields.
The SET said its dividend yield in the first half was 3.3 per cent, overtaking Singapore’s 3.1-3.2 per cent. Thanks to fund inflows, the SET recorded average daily turnover of Bt46.67 billion in the first six months of the year.
According to SET president Kesara Manchusree, including daily turnover of Bt64 billion in July, the average in the first seven months would be Bt48.16 billion, up 0.97 per cent from the same period last year.
For the first six months, the Thai bourse recorded Bt35.98 billion in net buys by foreign investors, turning around from a net-sell last year and making it the highest figure in Asean, Kesara said.
The Thai stock market is still underweight while foreign funds were in rebalancing mode, increasing the chance for continued inflows. According to Santi Kiranand, senior executive vice president of SET, about 30 Thai stocks are described as “investability”, or those with market capitalisation of more than US$1 billion and daily turnover of more than $10 million.
“We believe the fund inflows could make foreign investors’ daily turnover become square, compared with last year’s net sell of Bt40 billion to Bt50 billion,” he said, adding that the inflows for this round were not believed to be just “hot” money.
Yesterday, the SET Index lost 0.52 per cent or 7.85 points, as traders await central-bank meetings in Japan and the United States this week. Foreign funds remained brisk.
The index stood at 1,504.81 points on turnover of Bt58.69 billion. Foreigners had remained net buyers of Thai shares for 12 consecutive days and the month to date net-buys amounted to Bt36.6 billion.
Tisco Securities said in a research note that the market could move sideways up or down ahead of the meetings, but the SET Index is not expected to fall below 1,495 points this week.
Kesara added that the SET Index in the first six months surged by 15.2 per cent in dollar terms (12.2 per cent in baht terms) to stand at 1,444.99 points, which was highest performance in the region. Meanwhile, Indonesia recorded 14.9 per cent in dollar terms, the Philippines 11.7 per cent and Vietnam 10.1 per cent.
“Foreign investors tended to buy more Thai stocks continuously,” she said.
She said one reason for the Thai stock market’s outstanding performance was better-looking key economic indicators than other countries in the region.
Thailand’s gross domestic product last year grew by 2.8 per cent, and in this year’s first quarter GDP growth was 3.2 per cent. The country’s export growth was negative, but relatively better than others as all of Asean recorded a contraction in exports for the first half except for Vietnam. Moreover, inflation was low in Thailand.Kesara said fund mobilisation by listed companies this year looked like reaching the target of Bt525 billion. For the first six months, the market recorded a total of Bt152.23 billion in funds raised by listed companies.
Santi said that early this year, the exchange set its target for fundraising via initial-public-offering shares at Bt270 billion and secondary-public-offering shares at Bt255 billion. However, IPO shares for this full year are expected to reach Bt190 billion, falling short of the target, but SPO is likely to break the target to Bt350 billion.
In addition to the SET’s support activities related to investments, Kesara said it would launch the “sSET Index”, covering small-to-medium-cap stocks that were out of the SET100 Index, in November. Details would be revealed later.
