All eyes on Fed tonight amid lack of supporting factors for Thai stocks

The focus is on the US Federal Reserve meeting tonight (Thailand time), which will signal monetary and economic policy, according to Yuanta. The recovery of Thai stocks is limited by the tense situation in the Middle East, the company said, adding, the market lacked supportive factors.

Yuanta Securities noted that the investment atmosphere in the Asian stock market is currently pressured by China's October PMI (purchasing managers' index) figure of 49.5 points for manufacturing, lower than the expected 50.2 points, and 50.6 points for services, lower than the expected 51.8 points. This downward adjustment in the PMI index for October is attributed to seasonal factors, which typically occur every year due to the long holiday period, known as the “Golden Week”.

The Stock Exchange of Thailand (SET) Index dropped by 14.02 points (-1.00%) to close at 1,381.83 points on Tuesday (October 31). The SET decline was higher than the regional average due to the pressure from stocks linked to China's economy, including petrochemicals, electronics, energy, retail, communications, and finance, resulting from net foreign capital outflows of 2.3 billion baht.

The SET Index today is expected to move sideways within the range of 1,375-1,385 points.

However, the key swing factor that would determine the market's direction for the rest of the week is the US Federal Open Market Committee meeting tonight. The market expects the Fed to maintain the interest rate at 5.25-5.50%.

Therefore, the attention would be on the Fed chairman's views on the future monetary policy trends and economic conditions.

Yuanta urged investors to wait for these insights before increasing their investment weight.