“August 2020 FETCO ICI survey results in neutral zone as investors anticipate domestic economic growth and recovery of the tourism sector while worrying about the political situation and a domestic economic recession.”
FETCO Press Release: Thursday August 13, 2020
Paiboon Nalinthrangkurn, Chairman of the Federation of Thai Capital Market Organizations (FETCO), commented on the August 2020 FETCO Investor Confidence Index (ICI) as follows: “The Investor Confidence Index for the next three months fell 16% and remained neutral as in the previous month. Investors pin their hopes the most on domestic economic growth followed by recovery of the tourism sector, government policy, and progress in producing a COVID-19 vaccine. Negative factors impacting investor confidence include the domestic political situation, the domestic economic slowdown, and listed company earnings.”
Results of the FETCO Investor Confidence Index for July 2020 Survey are summarized below:
- FETCO Investor Confidence Index (ICI) for the next three months (through October 2020) for all groups of investors decreased 16% to 85.26, but remained in the neutral zone (index range 80–119).
- ICIs for all groups of investors were in the neutral zone.
- The Food & Beverage (FOOD) sector drew the most investor interest.
- The Banking (BANK) sector was least attractive for investors.
- Domestic economic growth was the factor boosting the Thai stock market the most.
- The domestic political situation had the biggest negative impact on the Thai stock market.
“July 2020 FETCO ICI survey results showed all investor groups’ ICIs were in neutral territory. Retail investor confidence rose slightly to 87.04, while proprietary traders dropped to 83.33. Both local institutional investor and foreign investor ICIs dropped, to 89.47 and 83.33 respectively.
During July 2020, The Stock Exchange of Thailand (SET) Index closed at 1,328.53, down slightly from June. The SET Index moved within the narrow range of 1,315–1,377 points as businesses resumed operations resulting in more economic activity. Positive factors affecting investor confidence were the Banking sectors’ second-quarter earnings being better than expected and reported progress in developing a COVID-19 vaccine. However, US–China tensions and the domestic political situation dragged down investor confidence.
Investor anticipation of domestic economic growth boosted confidence the most. Other factors buoying investor confidence included a hoped-for recovery of the tourism sector, government policy, and the development of a COVID-19 vaccine. In contrast, the domestic political situation was the biggest drag on confidence, followed by fears of a domestic economic slowdown and the performance of listed companies.
Economic factors which warrant monitoring include earnings reports of listed companies both in Thailand and abroad which may be worse than expected; 2nd quarter 2020 GDP numbers; US–Chinese political tensions; and a second wave of COVID-19 in many countries. Domestic factors which investors are keeping an eye on include the risk that Thailand may be blacklisted by the US Treasury as a country manipulating foreign exchange rates; the effects of recent stimulus measures as they are gradually phased out; and the results of the Phase 6 easing of lockdown measures which will allow more foreigners to enter Thailand.”
For more information, please contact
Federation of Thai Capital Market Organizations (FETCO)
Telephone: 02 009 9520 / 02 009 9506 /02 009 9484
or email: firstname.lastname@example.org