News Column

Optimism drives SET rally

August 14, 2014

By Darana Chudasri, Bangkok Post, Thailand

Aug. 14--Thai shares rallied 1.59% yesterday as the market played catch-up with Asia's gains after a long holiday, along with a buying spree from a number of new target return funds.

Analysts were optimistic the market's run-up could continue on political developments and a potential end to institutional investors' sell-off. The baht gained against the greenback to below 32, also bolstering sentiment.

The SET index, the best performer in Asia yesterday, peaked at 1,546.32 points in late trade before closing the market at 1,544.55 with brisk turnover of 56.15 billion baht. Large cap stocks were at the centre of the rally, led by the banking sector.

Foreign and institutional investors as well as brokers were net buyers of 3.68 billion, 2.61 billion and 634.62 million baht, respectively, while retail investors yanked 6.33 billion baht out of the market.

"Foreign investors trade back and forth in Thai shares, while institutional investors, probably target return funds, accumulated stocks before the long holiday," said Chai Chirasevenuenpraphund, head of research at Capital Nomura Securities.

CNS forecast the SET might test 1,590 points if foreign fund flows are persistent.

Kriengkrai Tumnutud, head strategist at AEC Securities, said selling pressure by institutional investors had been subdued and they were buying back.

"Foreign investors bought shares worth 50 billion baht early in the year, then unloaded 16 billion in July, leaving a net buy of 32 billion. We believe their sell-off has ended and they are buying," he said.

After the main gauge hit 1,526 points, buying signs emerged and investors should increase equities in their portfolios, said Mr Kriengkrai, but he was wary over whether foreign fund inflows would continue.


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Source: Bangkok Post (Thailand)

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