Investors’ Confidence cooled down to “neutral” zone

Economic stimulus measures and tourism recovery to boost sentiment

International conflicts and local economic slowdown undermine”

——————————————————————————-

                                                                      FETCO Press Release: 11 December 2024

 

Kobsak Pootrakool, Chairman of the Federation of Thai Capital Market Organizations (FETCO), revealed that the FETCO Investor Confidence Index (FETCO ICI) in November 2024 (conducted during 20-30 November 2024), which anticipated the market condition over the next three months, is in “neutral” zone at 118.28. The government’s economic stimulus package is the most supportive factor, followed by tourism recovery and optimism on easing international conflicts. However, international conflicts, local economic slowdown, and inflation weigh on sentiment.

 

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

  • Overall FETCO Investor Confidence index for the next three months (February 2025) is in “neutral” zone (80-119 of FETCO ICI Criterion) at 128.
  • Confidence of retail, proprietary and institutional investors is in “neutral” zone while that of foreign investors is in “bullish” zone.
  • Most attractive sector is Tourism and Leisure (TOURISM).
  • Least attractive sector to investors is Automotive (AUTO).
  • Most influential factor driving the Thai stock market is the government’s economic stimulus measures.
  • Most important factor impeding the Thai stock market is international conflicts.

 

“The survey results in November 2024 show that confidence of investors across all types retreats, retail investors down 26.8 percent to 101.54, proprietary investors down 40.0 percent to 90.00, institutional investors down 15.6 percent to 118.18 and foreign investors down 25.9 percent to 133.33.

 

In the first half of November, SET Index increased mildly, driven by better-than-expected earnings of listed companies in several sectors. However, the benchmark retreated after Donald Trump won the U.S. President Election. His pro-U.S. stock policy triggered fund outflow from emerging markets, which include Thailand. In addition, the trend of Fed’s slowing pace of policy rate cut dampened the sentiment. At month-end, SET Index closed at 1,427.54, down 2.6 percent from the previous month with an average daily trading value of THB44,256 million. Foreign investors were net sellers of THB13,597 million. Their net selling totaled THB136,354 million year to date.

 

External factors to monitor include the U.S. import tariff policy after the inauguration of Donald Trump as the 47th president of the United States takes place on 20 January 2025. Fed’s policy rate direction after inflation has been subsided but remains beyond its inflation target of 2 percent and re-emerging Russia-Ukraine tension are also on the watch. Locally, eyes are on pace of economic recovery, which is expected to be boosted by tourism, the government’s digital wallet scheme Phase 2 and debt-relief plans. In addition, expected buying spree in tax-saving funds, including RMF, SSF and ThaiESG will also shape the sentiment.