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In October, The Stock Exchange of Thailand (SET) was boosted by continued foreign capital that has flown into the market for five consecutive months now due to high liquidity in global capital markets and the strong fundamentals of the Thai economy and its listed firms. Foreign investors had net buys of THB15.74 billion (approx. USD524.73 million) for the month. The SET Index closed at 984.46, a 0.94% rise over the previous month and a 34.02% surge over year-end 2009. Meanwhile, daily trading in October averaged THB34.55 billion (approx. USD1.15 billion), while daily trading for derivatives averaged at 23,362 contracts, a drop over the month earlier but still at a high level. Gold futures reached a record daily trading volume high of 6,448 contracts on average, due to rising global gold prices. The combined SET and Market for Alternative Investment (mai) market capitalization was THB8.04 trillion (approx. USD268.02 billion), while listed companies raised THB9.40 billion (approx. USD313.37 million) through SET and mai.
SET performance was in line with that of other regional exchanges. Foreign investors continued to increase their investment capital in Asian markets, as investors expected that the US Federal Reserve will use QEII to increase liquidity in the financial system in early November 2010, combined with Asian economic indicators that reflected a continuing expansion of private demand and improving economic situation. For Thailand, in Q3/2010 banks expanded at an impressive rate, as shown by an accelerating loan rate, reflecting economic recovery, particularly in domestic demand.
In October 2010, the industry indices with the highest rates of increase were Industrials and Resources, which rose 8.93% and 5.58%, respectively, while Property & Construction dropped 3.68% drop over the previous month. The increase in the SET Index pushed SET’s forward P/E ratio as of October, 2010 rise to 14.08 times, which was in line with events at other regional exchanges. It also resulted in a continual rise in a combined SET and mai market capitalization, which was at THB8.04 trillion (approx. USD268.02 million), a 1.24% rise over the previous month and 36 % increase over year end-2009.
In October 2010, combined SET and mai daily average trading value was THB34.55 billion (approx. USD1.15 billion), a 15.31% drop month-on-month but soaring 27.88% year-on-year. Foreign investors have been net buyers for five consecutive months now, resulting in a total net buy of THB56.92 billion in January-October 2010, or a 1.50 times comparing to a total of foreign net buys of THB38.01 billion (approx. USD1.27 billion) in 2009. Retail, local institutional investors and proprietary traders were sellers this month. Trading value by Industry showed a continual increase of interest in Energy & Infrastructure since September 2010, while trading in Banking, Property Development, and Information and Communication Technology decreased over the previous month. In October 2010, investors showed an interest in small securities comparing to the previous month. The proportion of the trading in Non-SET50 shares in October showed substantial rises to 35.37% from 27.23% in the previous month.
As of end-September, 2010, the number of active trading accounts was 178,000 a 24.38% rise y-o-y, and a 4.89% rise m-o-m. Moreover, Internet trading account continually received greater attention, with 72,917 accounts in September 2010, a 46 % m-o-m, and a 5.89% rise over the previous month. Internet trading was accounted for 25.9x% of total trading value.
In October, Thailand Futures Exchange PCL (TFEX) traded 461,874 contracts, with daily average trading volume of 23,362 contracts, up 45.9x% over the same period last year but a 4.73% drop over the previous month. This decline resulted from a decrease in trading volume of SET50 Index Futures, SET50 Index Options, and Single Stock Futures. However, gold futures made a new daily average trading record high to reach 6,448 contracts -- the highest since gold futures was launched in February 2009. The rise was due to an increase of global gold prices. In addition, TFEX started trading interest rate futures, with 20 contracts traded in the first month.
SET’s improving performance supported continual fundraising. In October 2010, listed companies raised THB9.40 billion (approx. USD313.37 million), including funds raised through the initial public offering of Universal Adsorbents & Chemicals PCL and Gunkul Engineering PCL, with THB120 million (approx. USD4 million) and THB540 million (approx. USD18 million), respectively. Thai Union Frozen Products PCL (TUF) and CIMB Thai Bank PCL (CIMBT) used seasonal equity offerings through SET and mai to raise THB8.83 billion (approx. USD294.37 million). Over the first ten months of this year, listed companies have raised THB81.35 billion (approx. USD2.71 billion), up 157.11% y-o-y, when fund raised came to THB34.64 billion (approx. USD1.15 billion).
