Thai stock market accelerates under new Speaker of the House.

Posted: July 5, 2023 at 06:10 AM

The Bangkok Stock Exchange (SET) recovered modestly on Tuesday as investors hailed the choice of the House speaker as a breakthrough in the political stalemate ahead of a parliamentary vote for a new prime minister later this month.

The SET index opened lower on Tuesday but moved into positive territory after Pratchatchatchat Party's Wan Muhamad Noor Maha was appointed speaker of the newly elected House of Representatives.

"The period of pressure on the SET lasted more than a month and a half due to post-election uncertainty," said Paradorn Thiranapramote, first vice president at research unit Asia Plus Securities (ASPS).

Overseas investors continued to buy SET shares in the past few days, in contrast to net selling on other regional bourses, as investment sentiment improved.
The baht strengthened above 35 per dollar yesterday, indicating an inflow of funds to the Thai bourse," he said.
Nattapol Khamtakrua, director of securities analysis at Yuanta Securities, expects the Thai bourse to have limited up and down swings as concerns remain over legal challenges to Advancement Party (MFP) leader Pitha Limjaroenrat's qualifications, names of economic ministers and changes in coalition parties.

"After nearly two months of political emptiness, the market is still waiting to vote for the next prime minister from July 13 to 15," Mr. Nattapol said.

"The stock market favors political clarity, so if the coalition parties respect the membership of the new government, the market will react positively."

KGI Securities said investors will continue to monitor the political situation until a prime minister is chosen.

"Our baseline view remains that the Thai Senate will not support the leader of the Advancement Party for prime minister," KGI said in a research note.

ASPS stated that despite the political uncertainty, the SET rose to 1,506.84 last week, increasing by 40 points or 2.7% over three days, showing a slight sign of positive sentiment.

Foreigners were net buyers in three out of the last four days, totaling 1.4 billion baht, which is the largest amount in the region, while North Asian markets returned to selling after several days of buying.

The baht rose by 1.08% from June 28 to July 3, reaching 35.23 against the greenback, making it the strongest currency in the region during this period.