FETCO Confidence Index on March 2017


“Foreign and retail investors express concerns over US trade policy and FED interest rate hikeswhile local institutions remain optimistic about domestic economic growth as the ICI slides back into neutral territory.”

Dr. Kanate Wangpaichitr, Secretary-General of the Federation of Thai Capital Market Organizations (FETCO), had the following comments about the monthly FETCO Investor Confidence Index (ICI) for March 2017:  “The overall ICI for the next three months fell back into the neutral range after having risen into bullish territory last month. In the meantime, the US stock market has hit historic highs while stock markets in other regions of the world remain volatile.
In Thailand, however, domestic economic growth was likely to boost the capital market.”  Details follow.

  • FETCO Investor Confidence Index (ICI) for the next three months (through May 2017) stood at 110.24 (within the range from 0 to 200), a decrease of 8.58% from last month’s 120.59, resulting in the index falling into neutral territory.
  • Local institutional investors remained bullish while retail investor confidence was neutral and foreign investors’ ICI dropped into the neutral range.
  • Banking (BANK) became the most attractive sector for investment while Steel (STEEL) drew the least interest from investors.
  • The most influential factor bolstering confidence in the Thai stock market was domestic economic growth.
  • The volatility of capital inflow/outflow was the biggest drag on the Thai capital market.

The overall global economy is still awaiting clarification with regard to US economy policy and what effects it might have on international trade.  There are also risk factors associated with US tax reforms, possible trade barriers, and the expected US Federal Reserve (FED) interest rate hikes throughout 2017.  Uncertainty also exists about European politics and economic policies which may change after general elections in a number of countries.  And the implementation of Brexit has led to global and ASEAN equities markets fluctuating in line with interest rate trends and capital inflow/outflow within the region. Notably, the US stock market has risen to record highs.  However, the Thai stock market has experienced limited movements due to encouraging domestic factors as investors continue to have a positive outlook on Thailand’s economic growth prospects, especially in light of government investments, government stimulus policies, the boost provided by the tourism sector, and expanding exports.  Likewise, private sector spending shows signs of improvement from growing farm incomes.  Finally, the performance of listed companies in Q4 2016 was promising as most expected profits to grow.

Download
FETCO Investor Confidence Index Report
Press Release