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Thailand’s SET Stock Market Sees Exodus of US$ 2.8 Billion in Capital

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stock market, Thailand's SET Stock Market Sees Exodus of US$ 2.8 Billion in Capital

More than US$ 2.8 billion in capital flowed out of Thailand’s SET stock market in the first seven months of the year, partly because of the pandemic, sputtering attempts to revive foreign tourism, and possibly a second year of economic contraction.

The pandemic situation in Thailand has rapidly worsened, with daily new infections exceeding 20,000 cases yesterday.

Amid uncertainty during the pandemic, Thailand’s SET Index in July dropped by 4.1% from the preceding month. The worsening pandemic has undermined plans to reopen to vaccinated tourists and led to an exodus of funds from the Thai bourse this year, Pakorn Peetathawatchai, president of the Stock Exchange of Thailand (SET) told the Bangkok Post.

However, the baht depreciation should help Thai exports to improve in the second half this year, he said.

Mr Pakorn said at the end of last year, there were about US$400 million of capital inflows to the Thai stock market thanks to the country’s good control of the pandemic.

Thailand’s SET Stock Market Brokers Positive

Last year Thailand’s SET also recorded a huge amount of capital outflows, totalling US$7.88 billion. Total outflows were only 95.6 billion baht in the first seven months of 2021 and 17.7 billion in July despite the negative factors.

SET senior executive vice-president Soraphol Tulayasathien said even with the global pandemic, the IMF maintained its estimate of worldwide economic growth at 6% in 2021.

The IMF upgraded the growth rate forecasts for developed economies, but downgraded those of developing countries because they have less access to Covid vaccines and therefore a reduced chance to achieve herd immunity.

The downgrade and the prospect of a US interest rate increase are other factors that caused fund outflows, he said.

Mr Soraphol said the SET Index in July gained 5% from the end of 2020, eclipsing regional peers.

The SET’s average daily trade for the first seven months stood at US$2,89 billion.

Local investors were net buyers of 129 billion baht.

He said while some industries may enter a slump, those expected to outperform are agriculture and food, technology, property and construction, and the service sector.

 

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