Thai stocks likely to remain bullish
Buoyant emerging markets economies are pulling ahead.
The US Fed keeps easing up yet again, even while interest rates there are near Zero.
This spells more trouble for the dollar and so my money will keep flowing to Asia. Most countries in SE Asia have prudent fiscal and government finances in place with far less financial leverage then both the US and EU. Surely Thailand is a leader on this here.
If the next round of quantitative easing is lower again than expected it's going to be negative for US equities and the Dollar. But positive for Asia stocks which have underlying firm currencies, stronger entrenched growth rates and not least, fiscal responsibility, the globe’s new savior word.
High leverage with low or near no growth rates, remains the danger in the West. Currency weakness along with older demographics does not help.
The reality is knocking at the door, emerging markets economies are pulling the world forward with both higher growing economies, stronger stock markets besides currencies. This is the macro trend taking us into year 2011 and the likely hood for still higher Thai stock prices with the SET index probably passing 1000 before the end of this year.
Thai stock price rises are now however broadening out with many secondary shares waking up. As this happens nice capital gains will be made in secondary issues which have lagged the SET so far this year.
Best Regards,
Paul Renaud.
