“ICI continues in ‘neutral’ zone for fourth consecutive month

Economic stimulus and Fed’s policy to boost sentiment

International conflicts and inflation hold back confidence”

  FETCO Press Release: June 10, 2024

 

Kobsak Pootrakool, Chairman of the Federation of Thai Capital Market Organizations (FETCO), revealed that the FETCO Investor Confidence Index (FETCO ICI) in May 2024 (conducted during 23-31 May 2024), which anticipated the market condition over the next three months, is at 100.72 and continues in “neutral” zone for fourth consecutive month. The government’s stimulus package is the most positive factor to boost confidence, followed by Fed’s monetary policy and local economic recovery. However, top three most impeding factors are international conflicts, inflation and Baht fluctuation respectively.

 

Highlights of FETCO Investor Confidence Index surveyed in May 2024 are as follows.

  • Overall FETCO Investor Confidence index for the next three months (August 2024) is in “neutral” zone (80-119 of FETCO ICI Criterion) at 100.72.
  • Confidence of retail, proprietary and foreign investors is in “neutral” zone while that of institutional investors is in “bullish” zone.
  • Most attractive sector is Food and Beverage (FOOD).
  • Least attractive sector to investors is Fashion (FASHION).
  • Most influential factor driving the Thai stock market is the government’s stimulus package.
  • Most important factor impeding the Thai stock market is international conflicts.

 

“The survey results in May 2024 show that retail investors’ confidence is up 26.7 percent to 96.88, proprietary investors up 28.6 percent to 100.00, institutional investors down 0.7 percent to 122.22 and foreign investors steady at 100.00.

 

SET Index moved in tight range in May as market looked for fresh cues. The latter half of the month saw SET Index track regional peers’ downward trend on concerns that the Fed may leave its policy rate to stay at high level. In addition, foreign investors’ sell-off ahead of MSCI’s weighing adjustment to mitigate their exposure risk. The local political situation and ongoing conflicts in the Middle East dampened sentiment further. At month-end, SET Index closed at 1,345.66, down 1.6 percent from the previous month with an average daily trading volume of THB 45,162 million. Foreign investors were net sellers of THB 16,566 million and their year-to-date net selling totaled THB 81,641 million.

 

External factors to monitor include global economic recovery following trend of easing monetary policy; China’s economic recovery as the government announced that additional stimulus will be in place in the second half of the year; and uncertainty on conflicts in the Middle East. Internally, investors follow Baht movement volatility, the government’s plan to fund digital handout scheme while anticipating that the Bank of Thailand’s may cut its policy rate later this year. In addition, the local political stability remains a concern for foreign investors.”