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The International Monetary Fund (IMF) has upgraded Thailand’s economic outlook this year to 4.4 percent from 3.6 percent earlier forecast, underpinned by the growing domestic demand and private consumption propelled by the government’s fiscal stimulus. As the global inflation is cooling faster than expected, the Federal Open Market Committee (FOMC) has kept its short-term interest unchanged at 5.25-5.50 percent until higher confidence that inflation will be eased to 2 percent in a sustainable manner.
Senior Executive Vice President of The Stock Exchange of Thailand (SET) Soraphol Tulayasathien said that pessimism on the lower-than-expected economic growth for the final quarter of 2023 triggered cuts in listed companies’ 2023 profit growth and fund outflows from the Thai stock market in January 2024, accordingly. If tracking back foreign investors’ fund flows over the past 10 years, fund inflows were seen only in the years when listed companies’ profit forecast was raised significantly. Despite the offshore fund pullback, foreign investors’ shareholding value compared to market capitalization remained close to the historical average. Moreover, the Thai stock market’s price to book value was still low while dividend yield rose to 3.24 percent. However, investor confidence in the Thai stock market in January 2024 declined from early last year, dampened by local and overseas factors.
Key highlights for January
- At the end of January 2024, SET Index fell by 3.6 percent from the previous month to close at 1,364.52 points, moving in line with the regional peers.
- In January, industry groups that outperformed SET Index compared with the end of 2023 were Consumer Products, Resources, Services, Agro and Food Industry, and Technology.
- SET’s and Market for Alternative Investment (mai)’s average daily trading value in January 2024 dropped 34.6 percent from a year earlier to THB 47.11 billion (approx. USD 1.32 billion). Foreign investors turned to sell Thai shares in January with a net THB 30.87 billion in January 2024 after they were net buyers in the preceding month. Their trading ratio was higher than any other types of investors for 21 consecutive months.
- In January, there were a newly listed company on SET: Advice IT Infinite pcl (ADVICE).
- The Thai stock exchange’s forward P/E ratio at the end of January 2024 was 15.5 times, above the Asian stock market’s average of 12.9 times. The historical P/E ratio stood at 16.7 times, exceeding the Asian stock market’s average of 14.7 times.
- Dividend yield ratio at the end of January 2024 was 3.24 percent, below the Asian stock market’s average of 3.31 percent.
Derivatives Market
- Thailand Futures Exchange (TFEX)’s daily trading volume in January 2024 averaged 404,435 contracts, down 17.3 percent from the previous month largely due to the lower trading volume of Single Stock Futures and SET50 Index Futures.
