Thai stock market plunges amid public debt issues and decreased GDP forecast

Following Under the table of over 1.5% yesterday, the Stock Exchange of Thailand (SET) dropped beneath the 1,450 points mark. This follows mounting apprehensions regarding escalating public debt and financial growth after the World Bank scaled down its forecast for the Thai GDP.
Daol Securities (Thailand) famous promoting pressure from the majority of investor teams as a result of persisting worries in regards to the Federal Reserve’s potential rate of interest hike. The baht, in response to the continuous appreciation of the US bond yield and greenback, has fallen to an 11-month low, dipping beneath 37 baht (US$1).
The Thai bourse, closely reliant on power shares, has additionally been impacted by a decline of over 2% in global oil prices.
Daol Securities famous that as traders gradually scale back dangers, we foresee a continued decline within the SET index because no optimistic elements have been noticed within the Thai market recently.
The brokerage additional famous that investors’ choice to hold cash represents a adverse development for the stock market. On the domestic entrance, there are considerations in regards to the excessive degree of household debt and the potential enlargement of the common public debt ceiling.
The World Bank just lately revised its Thai GDP forecast for 2023 from 3.6% to three.4%, and its 2024 outlook from 3.7% to three.5%, attributing it to an export slowdown and increasing public debt probably pressurising private and non-private investments, reported Bangkok Post.
Oil pipeline

Meanwhile, following a six-month closure, Turkey plans to reopen the oil pipeline from Iraq this week, doubtlessly growing the oil supply. Energy consultancy Rapidan Group means that Saudi Arabia could ramp up oil manufacturing as quickly as the Brent crude value surpasses US$90 per barrel.
Globlex Securities’ research director, Wilasinee Boonmasungsong, pointed to numerous unfavorable components presently burdening the Thai stock market. Most notably, the World Bank has expressed concern over rising family debt, which now approaches 80% of GDP, the highest within the area.
Foreign investors have offered Thai shares price 157 billion baht this 12 months, while different investor types have been internet consumers.
Investors are advised to observe government policies and Commerce Ministry-released export figures and commerce data this week, based on Wilasinee. She also urged investors to track third-quarter financial institution earnings reviews, set to be gradually introduced in mid-October.
Asia Plus Securities (ASPS), however, believes that the SET index is unlikely to rebound, though the draw back is relatively low.
ASPS maintains that the updated Thai GDP forecast from the World Bank, still larger than other establishments, will barely have an effect on the SET index.
It anticipates that financial stimulus measures will begin exhibiting results from the fourth quarter of this 12 months, with GDP predicted to peak within the second quarter of subsequent year.
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