Political jitters sink SET
- Published: 2/08/2013 at 05:05 PM
- Online news:
Thai stocks sank another 1.15% on Friday even as Asian and worldwide markets gained on good economic news, as local investors grew more nervous about the prospects of political conflict.
The Stock Exchange of Thailand Index fell 16.57 points to close at 1,420.94, a decrease of 3.8% from the previous Friday's close of 1,476.71, its biggest weekly loss in six weeks.
Many investors have sold or moved to the sidelines with the resumption of parliament this week, amid anxiety about possible protests that could start as soon as Sunday ahead of a parliamentary debate over an amnesty bill on Tuesday.
Turnover on the SET was weak at 37.95 billion baht, well down from the daily average of 61.5 billion baht recorded in the first six months of the year. A total of 7.86 billion shares were traded.
The local market is up only 2% from the end of 2012 and down 13.6% from the year-high of 1,643.34 reached in mid-May.
Local retail investors were the only group buying more shares than they sold on Friday with net buying worth 1.82 billion baht. Foreign investors were net sellers of 1.64 billion baht, local institutions 1.45 billion, and brokers 1.45 billion baht.
For the year to date, foreign investors have sold 78 billion baht more in Thai shares than they have sold.
World markets were mostly higher as investors awaited key US data that they hoped would provide more evidence of a strengthening recovery in the world's biggest economy.
Investors' hopes were already raised after a report by the Institute for Supply Management that found US manufacturing activity jumped last month, signalling a rebound in industrial production.
In early European trading, Germany's DAX and France's CAC 40 were both up 0.1% and the FTSE 100 in London was up marginally. US stocks were poised to rise, with Dow and S&P futures both advancing 0.1%.
Most Asian markets ended higher. Japan's Nikkei 225 surged 3.3% to 14,466.16, with shares of export-oriented companies helped by a weakening yen. Hong Kong's Hang Seng added 0.5% to 22,190.97 while the Shanghai Composite Index rose less than 0.1% to 2,029.42.
South Korea's Kospi was up 0.1% to 1,923.38 and Australia's S&P/ASX 200 climbed 1.1% to 5,116.80. Benchmarks in Singapore, Taiwan and New Zealand also rose. Only Manila and Bangkok fell.
In Bangkok, the SET50 index of blue chips ended at 966.98 points, down 10.49 points, with total trade value of 29.31 billion baht. The SETHD index of high-dividend shares lost 7.81 points to 1,148.16, with turnover of 10.62 billion baht. The Market for Alternative Investment shed 8.19 points to 385.99, with transaction value of 789.49 billion baht.
The five most active shares by value included four telecom firms: Advanced Info Service (ADVANC), down 5 baht to 282; Jasmine International (JAS), down 15 satang top 8.20 baht; TRUE, down 35 satang to 7.80 baht; and Shin Corp (INTUCH), off 1.75 baht to 88.50. The 7-Eleven operator CPALL ranked fifth, unchanged at 34 baht.
In the currency markets, the baht was poised for its biggest weekly loss since June on concern that a proposed amnesty for political protesters could trigger civil unrest.
The yield on 10-year government bonds also rose to a two-year high above 4% as the government invoked the Internal Security Act in parts of Bangkok while parliament debates the amnesty bill.
"Political uncertainty is the main concern affecting the baht in the near term," said Wee-Khoon Chong, a Societe Generale strategist in Hong Kong.
"The overall economic outlook in the region remains fragile. The baht may well stay on the weak side to remain relatively competitive."
The baht was trading late Friday in Bangkok at 30.40/42 to the dollar, compared with 31.28.33 on Thursday, and 31.10/13 a week earlier. It lost 0.8% on the week, the most since the five-day period ended June 21. It touched 31.43 earlier on Friday, the weakest since July 9.
The yield on the 3.625% sovereign bonds due in June 2023 climbed 15 basis points on the week to 4.02%, according to data compiled by Bloomberg.
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