The Thai stock market is stuck in a groove.

The Thai stock market is stuck in a groove until meaningful reforms take place, by the brokers as well.

Many seasoned observers here know the reasons, beyond just “global events”, which are soo often cited by the gnomes running things here.  I can’t resist to name again just some of the core on this lethargy:  lack of substantial real reforms and not just by the regulators and SET, but also Thai brokers!   If an exchange is dominated by speculators its been proven again and again that in time, “bad money will chase out good”, speculators will burn themselves out in time,  real investors will increasingly shy away and it will  dwindle along with lost confidence.   This is in fact what is happening now.  Foreign institutional investors have sold "en masse" for almost a year, Thai retail investors are ½ of what it used to be, along with expats which both have ever lower trust.  Trust in fact is the most important key attribute in a stock exchange.  Some prominent Thai economist here pointed out how the TRUE bonds were way under-subscribed "because of low liquidity in the financial system".   I think it was along with other issuers of bonds lately, because there is a lack of trust.

Hope for some betterment is often a life-saver and instills some optimism, even in darker days.  What are the caveats just now for some legitimate SET hope?  Thailand is ruled by juvenile-politics as we saw last year, inept brokers which among other shortcomings mostly advocate trading at every turn, lame-duck regulators which see no need to change until ts at a crisis point and even then…as its been at a near crisis point for some time.  Yes, there are some positive changes, like at long last the SEC will now publish performance tabulation along with the financial advisors, post IPO’s issuance, as here pointed out at my front page.   The Prime Minster is trying very hard with some good biz. acumen to drum up foreign interest…and Thai inflation has tamed. Yes. But these are not enough in my view to turn things around in an economy which is considerably under-performing vs. its peers.  What real new caveats are there to turn things around?   

Hence at the start of this year, I am not SET bearish as it has sold off considerably already, just agnostic.  While recognizing there are some “diamonds in the rough” to cherry pick as these should do well, not least due to their double digit growth along with low p/e and very high dividends to the tune of double the SET average.  As here pointed out of late with gusto.

Best Regards & Happy New Year 2024.