Thai elections by end of February 2019, will likely be a rejuvenation.

PaulRen's picture

Thai Stocks at Major Inflection point.   Thai elections by end of February 2019, will very likely be a rejuvenation.

After allot of Thai stock investor pain in the past couple of years, especially to those which invested in anything other the the top SET 50 stocks.  Yet we got be now getting to a more positive, inflection point.  The huge investor capital mega sums plowing into the US stock market seems to forming a top, at last.  Major credible investor-houses are warming back up to emerging markets, for next year. Thailand stands out because at the same time its determined to have elections within a couple of months (as I here predicted for some time), has a stable Baht currency and not caught up much with the China/USA trade war and more...also benefits from renewed lower global oil prices.

What's amazing- is how nobody reports (not the CS research reports not the WSJ, or the local press) that while the big cap. SET50 has held up and so had the Thai Baht currency,  all other secondary Thai stock mkt. indexes have dropped during the past 3-4 years -and by more then just a little.  Most all quality and otherwise Thai secondary shares have lost half or more of their previous mkt. value.  Does this fact alone not say/confirm something about the middle income trap and the rise in inequality which the Govt. here denies?  Further, Thai retail investor participation remains at barely 40% of SET trading volume, vs. 65 to 75% in years past.  In nearly 30 years of partaking here, I have never seen this low number of retail investor participation.  Ask why is nobody writing about this and how long can this last?  Further, does this tell us about the reliability of global Biz-investor news?

But here as well, we are at an inflection point as this secondary share divergence (see graph below) cannot go on forever and once the Thai election rejuvenate takes hold, there will be a nice bounce at last or maybe more.

Paul A. Renaud.
Yellow line is SET index, Green line  is MAI (smaller stocks) index,  Blue line is sSet (smaller cap).