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As of end-July 2010, The Stock Exchange of Thailand (SET) Index was at 855.83, a 7.34% month-on-month (m-o-m) rise. This increase was in line with that at other regional exchanges, since investors had confidence to invest more in risk assets after the European debt crisis subsided, seen from the better-than-expected results from bank stress tests. Meanwhile, the regional and Thai macroeconomic indicators expanded at a satisfying rate, showing a continuing economic recovery. As a result, foreign funds continued to pour into regional markets, including the Thai exchange, in July. The SET Index rise resulted in a surge of SET market capitalization to reach THB6.91 trillion (approx. USD216.09 billion), a 7.40% m-o-m increase.
During July, the daily average trading value peaked at THB30.41 billion (approx. USD950.35 million), its highest value in 54 months (since February 2006) and a 38.18% m-o-m increase. Foreign investors continued to be net buyers for the second consecutive month, with a net buy position of THB6.83 billion (approx. USD213.30 million). Retail investors were the net seller, sharing as high as 66.65% of total trading value, reaching its 68-month peak.
In terms of trading value by Industry Group, the record showed that in July 2010 trading value in Energy and Petrochemicals and Chemicals considerably dropped, in contrast with substantial rises in share of trading value in Banking and Information and Communications Technology Sector which substantially rose. In terms of trading value by market capitalization, securities in Non-SET50 Index received great attention from investors for two consecutive months, with share of trading value of 35.69% of total trading value.
In July, Thailand Futures Exchange PCL (TFEX)’s daily average trading volume reached 13,954 contracts, a 17.43% drop over a month earlier, due mainly to a 30.16% drop in SET50 Index Futures. Single stock futures was the only product to record an increase in daily average trading volume in July. This instrument reached its highest daily average trading volume since it was launched.
In July, listed companies raised a total of THB386.03 million (approx. USD12.06 million), using equity. Officemate PCL was the only new listing that month, raising THB98.00 million (approx. USD3.06 million). Meanwhile, listed companies raised a total of THB288.03 million (approx. USD9.00 million) through seasonal equity offerings, mostly by SVI PCL (SVI) and Trang Seafood Products PCL (TRS). The funds raised in the seven months of 2010 were THB49.79 billion (approx. USD1.56 billion), a surge of 210.30% over the same period last year.
Performance Overview
As at end-July 2010, the SET Index had risen to 855.83, a 7.34% m-o-m surge, the second-highest rise in the region, after the Shanghai Stock Exchange. Moreover, the rise in the SET Index was a 16.51% increase over end-2009, its highest level in 31 months. The soaring SET Index resulted in SET market capitalization to rise up to THB6.91trillion (approx. USD216.09 billion), a 7.40% m-o-m surge. The changes in the SET Index were in accordance with changes in other regional exchanges. A major reason for the index changes is the rise in investors’ confidence to invest more in risk assets as the European debt crisis subsided: only seven out of 91 banks in European countries failed the stress test, resulting in a capital increase of EUR3.50 billion -- better than the analysts’ expectations-- even though macroeconomic indices reflected a slow and fragile economic expansion. Meanwhile, macroeconomic indicators continued to expand at a satisfying rate, showing continuing economic recovery. This resulted in a continuing flow of foreign funds into the region’s markets, including Thailand. The mai Index closed at 243.71, up 5.58% m-o-m, causing market capitalization to rise and reach THB46.84 billion (approx. USD1.46 billion), an 8.41% rise over a month earlier.
A surge of the SET Index in July 2010 resulted in an increase in the forward P/E ratio to be at 12.33, up from last month’s 11.53. However, the Thai forward P/E ratio is still lower than other markets in the region, except for South Korea. Meanwhile, Thai dividend yields are still at a high level comparing to other countries in the region, or at 3.63%, second to the Philippines.
Trading activity
In July 2010, the combined SET and mai daily average trading value reached its highest level in 54 months since February 2006. In July 2010, daily average trading value was at THB30.41 billion (approx. USD950.35 million), a 38.18% rise over the previous month or 70.65% over the same period last year. Total trading value of SET and mai was THB608.22 billion (approx. USD19.01 billion) in July of this year.
In terms of SET and mai’s combined trading value by customer type, foreign investors have been net buyers for two consecutive months, with a net buy of THB6.83 billion (approx. USD213.30 million). However, over the first seven months of 2010, foreign investors still have a net sell position of THB10.71 billion (approx. USD334.63 million). Meanwhile, retail investors have been net sellers, totaling THB2.43 billion (approx. USD75.89 million) – their second consecutive month of net sales. Local institutional investors were net sellers totaling THB3.68 billion (approx. USD115.11 million), after being net buyers for two consecutive months. Proprietary traders were net sellers of THB713.53 million (approx. USD22.30 million). Retail investors accounted for 66.65% of total trading value, their highest proportion in 68 months.
In terms of trading value by Industry Group, in July 2010 the shares of trading value in the Energy Sector and Petrochemicals and Chemicals Sector both considerably dropped over the previous month, or from 22.24% and 7.71% to 14.63% and 3.32%, respectively. The share of trading value in Energy Sector has plunged for two consecutive months, in contrast with the substantial rises in the shares of trading value of the Banking Sector and Information & Communication Technology Sector, from 20.62% and 6.61% to 24.75% and 10.45%, respectively.
Trading value in terms of market capitalization showed slight changes compared to the previous month. In July 2010, the share of trading value of the top ten securities in the SET50 Index slightly dropped to 28.39% from 30.03% in the previous month, its lowest level in a year. The share of trading value of the top 31-50 securities in the SET50 Index slightly increased to 13.24%, from 10.42% in the previous month. The share of trading value of securities that were outside of the SET50 Index remained as the highest proportion at 35.69%.
Number of trading accounts
In June 2010, the number of trading accounts bottomed out, rising after declining during March-May. In June 2010 there were 142,644 accounts in the capital market, with an active rate of 24.22% and an average trading value of THB3.39 million (approx.USD0.11 million) per account. The figures are higher than May 2010’s active rate of 23.23% and average trading value of THB2.84 million (approx. USD0.09 million) per account.
The number of active Internet trading accounts and Internet trading value rose as well. In June 2010, 55,829 Internet trading accounts were active, a 7.61% increase over the previous month, with a total trading value of THB119.18 billion (approx. USD3.72 billion), soaring 47.68% m-o-m. Internet trading value in June accounted for 24.61% of total trading value, up from 21.09% on a m-o-m basis.
Overview of the derivatives market
In July 2010, Thailand Futures Exchange PCL (TFEX)’s daily average trading volume reached 13,954 contracts, a 17.43% drop over the previous month, due mainly to a decline in SET50 Index Futures of 30.16%. Single stock futures was the only TFEX product that recorded a rise in daily average trading volume, up 15.79% m-o-m, its highest rate since its launch in November 2008.
Overview of funds raised
In July, listed companies raised THB386.03 million (approx. USD12.06 million), using equity. This total included funds raised through the initial public offering and listing of Officemate PCL of THB98.00 million (approx. USD3.06 million), plus THB288.03 million (approx. USD9.00 million) of two seasonal equity offerings: that of SVI PCL (SVI) of THB83.69 million (approx. USD2.62 million) for working capital, and that of Trang Seafood Products PCL (TRS) of THB50.00 million (approx. USD1.56 million) for reorganizing.
Over the first seven months of 2010, THB49.79 billion (approx. USD1.56 billion) were raised, soaring 210.30% over the same period last year, when THB16.07 billion (approx. USD502.31 million) were raised.
