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

Listed companies’ earnings and economic stimulus to boost sentiment

Local economic retreat and fund outflow undermine”

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                                                                      FETCO Press Release: 10 July 2024

 

Kobsak Pootrakool, Chairman of the Federation of Thai Capital Market Organizations (FETCO), revealed that the FETCO Investor Confidence Index (FETCO ICI) in July 2024 (conducted during 20-30 June 2024), which anticipated the market condition over the next three months, is at 82.89, remaining in “neutral” zone. Top three most supportive factors are listed companies’ earnings, the government’s stimulus measures and tourism recovery. However, local economic retreat tarnishes confidence the most, followed by fund outflow and local political situation.

 

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

  • Overall FETCO Investor Confidence index for the next three months (September 2024) is in “neutral” zone (80-119 of FETCO ICI Criterion) at 82.89.
  • Confidence of retail and institutional investors is in “neutral” zone while that of proprietary and foreign investors is in “bearish” zone.
  • Most attractive sector is Electronic Components (ETRON).
  • Least attractive sector to investors is Property Development (PROP).
  • Most influential factor driving the Thai stock market is listed companies’ earnings.
  • Most important factor impeding the Thai stock market is local economic retreat.

 

“The survey results in June 2024 show that investors’ confidence across investor types declines; retail investors down 3.3 percent to 93.65, proprietary investors up 42.9 percent to 57.14, institutional investors down 10.0 percent to 110.00 and foreign investors down 25.0 percent to 75.00.

 

SET Index headed south in the first half of June on concerns over the Constitutional Court cases against Prime Minister Srettha Thavisin and Move Forward party. Slower-than-expected production and exports dampened confidence, causing the benchmark index to fall below 1,300 mark during the middle of the month. SET Index rebounded mildly in the latter half of the month as market reacted positively to news that the ThaiESG fund investment conditions would be proposed to be revised while a plan to revive the Vayupak Mutual Fund was also welcomed. At month-end, SET Index closed at 1,300.96, down 3.3 percent from the previous month with an average daily trading volume of THB 45,238 million. Foreign investors were net sellers of THB 34,342 million and their year-to-date net selling totaled THB 115,983 million.

 

External factors to monitor include trend of global central banks’ easing monetary policy as inflation has been subsided; the U.S. elections and European parliament elections; and lingering geopolitical conflicts. Domestically, eyes are on government’s stimulus package to support exports and domestic consumption; budget disbursement, which is expected to drive the economy in the second half of the year; result of stimulus measure; ThaiESG fund; and result of measures to revive investor’s confidence, which is expected to ease the speed of sell-off by foreign investors and help revive the local stock market.