The Federation of Thai Capital Market Organisations’ (FETCO) Investor Confidence Index (ICI) remained neutral for the fifth month, recording 82.89 in June.
The index predicts market conditions over the next three months and suggests that stimulus measures and corporate earnings reports could enhance investor sentiment in the latter half of the year.
FETCO chairman Kobsak Pootrakool underscored three pivotal factors influencing the market: corporate earnings, government stimulus, and tourism recovery. These factors, while supportive, are being overshadowed by concerns about a potential local economic downturn, ongoing fund outflows, and domestic political uncertainties, which are keeping investor confidence fragile.
“The survey results in June show that investors’ confidence declined, led by a 25% drop among foreign investors to 75, while institutional investors’ confidence fell by 10% to 110.”
Retail investors’ confidence also decreased by 3.3% to 93.65, while proprietary investors’ confidence increased by 42.9% to 57.14.
In the first half of June, the Stock Exchange of Thailand (SET) experienced a downturn due to concerns surrounding Constitutional Court cases involving Prime Minister Srettha Thavisin and the Move Forward Party. However, the market saw a mild rebound later in the month, spurred by positive reactions to the revision of investment conditions for Thai ESG funds and plans to revive the Vayupak Mutual Fund.
By the end of June, the SET index closed at 1,300.96, marking a 3.3% decline from the previous month. The average daily trading volume was 45.24 billion baht. Foreign investors were net sellers of 34.34 billion baht, bringing their year-to-date net selling total to 115.98 billion baht.
External factors that investors should monitor include global central banks’ easing of monetary policies as inflation decreases, the upcoming US elections, European parliament polls, and ongoing geopolitical conflicts.
These global events have a significant impact on the Thai market, as Kobsak advised.
Domestically, the government’s stimulus package aimed at boosting exports and domestic consumption, along with budget disbursement expected to drive economic growth in the second half, are critical areas of focus. The progress of the new Thai ESG fund, a key development in the market, is under close watch and could potentially influence investor decisions.
Kobsak also emphasized the importance of measures to revive investor confidence, which are expected to slow foreign investors’ sell-off and support the recovery of the domestic stock market, reported the Bangkok Post.
