“ICI remains in “neutral” zone

Investors expect economic stimulus and recovery to boost sentiment

Fund outflow and Fed keeping interest rate steady undermine”

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                                                                      FETCO Press Release: 9 April 2024

 

Kobsak Pootrakool, Chairman of the Federation of Thai Capital Market Organizations (FETCO), revealed that the FETCO Investor Confidence Index (FETCO ICI) in March 2024 (conducted during 20-31 March 2023), which anticipated the market condition over the next three months, is at 106.91, barely changed from the previous month, which hung on to “neutral” zone. High hope is pinned on the government’s stimulus package while local economic recovery and anticipation on fund inflow are factors investors look forward to. Fund outflow, followed by Fed keeping its policy rate steady and international conflicts hold back confidence.

 

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

  • Overall FETCO Investor Confidence index for the next three months (June 2024) is in “neutral” zone (80-119 of FETCO ICI Criterion) at 106.91, matching the level marked a month ago.
  • Confidence of institutional investors is in “bullish” zone while that of retail, proprietary and foreign investors is in “neutral” zone.
  • Most attractive sector is Tourism and Leisure (TOURISM).
  • Least attractive sector to investors is Property Development (PROP).
  • Most influential factor driving the Thai stock market is the government’s stimulus package.
  • Most important factor impeding the Thai stock market is fund outflow.

 

“The survey results in March 2024 show that retail investors’ confidence is down 6.5 percent to 107.58, proprietary investors up 14.3 percent to 114.29, institutional investors up 16.1 percent to 141.67 and foreign investors steady at 100.00.

 

SET Index in March moved in a tight range between 1,359.26 to 1,394.93 as market looked for fresh cue while foreign investors yet returned. However, market was brought to live after the Bank of Japan ended an era of negative interest rates while Fed kept its policy rate unchanged at 5.25 – 5.50 percent as expected with indication that rates will likely be cut three times in 2024. At month-end, the SET Index closed at 1,377.94, up 0.5 percent from a month earlier. Average daily trading volume was THB 45,717 million. Foreign investors were net sellers of THB 41,239 million in March and accumulatively cashed out THB 68,862 million in Q1/2024.

 

Investors monitor interest rate moves by key global central banks such as Fed, European Central Bank and Bank of England following inflation slowdown. Re-emergence Russia – Ukraine conflicts will impact assets perceived as strong safe haven such as gold, of which its price has continued to rise. In addition, China’s manufacturing activity rebound supports Thailand’s exports. Locally, the Bank of Thailand is facing rate cut calls in a move to help stimulate economic recovery and shore up the stock market. Eyes are also on tourism recovery trend, government’s fiscal budget disbursement and clarity on the government’s THB 10,000 digital wallet scheme.”