BANGKOK, July 20 – TTB reveals that in the first half of 2023, net foreign fund flows from the Thai stock market amounted to more than 107 billion baht, pushing the index down to the lowest in two years, pointing to 3 fragile fundamentals in Thailand. "Thai stocks have low yields - slow economic growth - unstable politics", fearing to drag the long-term flow
TTB Economic Analysis Center or ttb analytics reveals that the Thai stock market is entering a sluggish market or bear market more clearly. It can be seen from the SET Index that it continued to fall until it broke the key resistance at 1,500 points, the lowest since April 2021, while the trading value was only 3-4 billion baht per day. which used to be as high as 100,000 million baht per day. In addition, foreigners continued to accumulate net sales throughout the first half of the year of more than 107 billion baht. Most of the retailers who were spoons bought against foreigners were greatly reduced. This corresponds to the number of trading accounts in the last six months (Active User) which has been steadily decreasing since the beginning of the year to only 980,000 accounts per month, compared to 1.3 million accounts during the hot market period. While global monetary policy is much tighter than in the past.
However, the phenomenon that foreigners continue to sell net It may not be the only factor in the market liquidity that is temporarily lost. But part of it comes from Thailand's fundamental factors that have been quite fragile over the years, especially 3 main factors: Factor 1: Expensive Thai stocks - concentrated, low returns, Factor 2: The economy has been fragile since before the COVID-19 situation. Resulting in no new supporting factors and the third factor: low political stability for a long time. Stimulate investor confidence. Since 2013, foreigners have been selling Thai stocks continuously almost every year. In addition, the election year Foreigners will sell some of their stocks before the election. On the other hand, foreigners continued to sell at least 50 billion baht after the election this time, reflecting concerns over political stability over the past several years. This caused a lack of continuity in policy implementation and undermined the confidence of foreign investors in the long term. It can be seen from foreign direct investment (FDI) that has continued to decline after 2013 and has continued to decline compared to neighboring countries such as Vietnam and Indonesia.
However, ttb analytics views that the SET Index in the second half of 2023 has a chance to recover (Rebound). Because the market has already realized the risk (Priced-In), with the upside factor inevitably being the establishment of the government and the clarity of economic policy that will be involved in setting up the budget for the year 2024, which may help pull foreign fund flows when the Thai economy encounters hard times in all areas.-Thai News Agency
Source: Thai News Agency