SET, baht buck regional trend
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THAI SHARES and currency yesterday bucked the regional rising trend with the baht bailing out to a two-week low and the Stock Exchange of Thailand Index leaping to its lowest level in seven weeks.
The SET Index plunged to its lowest at the morning bell, dipping 44.20 points, or 2.99 per cent, to 1,477.28, while its regional peers fell slightly.
The SET closed at 1,492.52, down 28.96 points or 1.90 per cent on turnover of Bt83.88 billion.
In early trading, the baht touched 34.721 per US dollar, the weakest since August 22. It opened at 34.62-34.64 and closed at 34.79-34.72, according to a Kasikornbank’s currency trader.
Chaiyaporn Nompitakcha-roen, head of non-institutional broking at Bualuang Securities, said the reason for the sharp drop was not clear yet but there could be “some worries”.
Voravan Tarapoom, chairman of the Federation of Thai Capital Market Organisations, said yesterday’s plunge in Thai shares might come from investors overreacting to rumours, not economic conditions.
Uncertainty cited
This was about uncertainty, which was usual, not issues to be concerned about, she said, warning investors not to be jittery.
“Don’t be panicky. In the short term, Thai stocks could rise or fall on both real news and rumours. But in the long term, news does not involve listed companies’ profit.
“As many as 150 listed |firms regularly pay dividends |and interim dividends. In the |long term, their prices depend |more on profit than news,” she said. Investors should consider whether news affects listed companies’ operating performance or not, she said.
Voravan, who is also chief executive officer of Bualuang Asset Management, said the house’s fund managers invested in stocks as Thai equities were believed to be heading up in the medium to long term.
However, it was a good time to purchase good stocks, as there was less chance for the Federal Reserve to raise its interest rate this month, given the lower-than-expected non-farm employ-ment figure, Chaiyaporn said, referring to the job creation reading released last Friday.
Investor confidence in the next three months is expected to see Thai stocks on the uptrend from inflows of foreign capital.
Individual investors’ confidence climbed 18.43 per cent. However, a negative factor remains with the US interest rate’s likely hike.
Voravan said attractive industries for investment were banking, energy and utilities.
“Looking at foreign markets and the Fed’s interest rate outlook, I think it’s not an external factor but rather an internal |one.
“What we see now is selling from institutional investors,” said Canakas Chirasevenupraphund, head of research of Capital Nomura Securities.
Institutional investors sold a net Bt4.86 billion on Friday, and sold a total of Bt9.27 billion last week.
In Asia, shares rose on a tailwind from gains on Wall Street after a weaker-than-expected US jobs report prompted markets to trim expectations that the Federal Reserve would bump up interest rates as early as this month.
“September is a very event-heavy month,” said Victor Felix, an analyst with AB Capital Securities Inc in Manila.
He was referring to the meetings of the Fed, Opec, Bank of England and Bank of Japan next week, and the G20 this month.
“We’re generally optimistic on the trading outlook for Southeast Asian stocks this week,” he |said.
