The chairman of the Stock Exchange of Thailand (SET) on Wednesday said Thailand’s credit ratings outlook if downgraded by two credit rating agencies will erode confidence among foreign investors.

SET chairman Sompol Kiatphaibool said that Moody’s Investors Service and Standard & Poor’s credit ratings companies are likely to lower Thailand’s ratings due to the country’s political chaos, which has now become an important indicator to Thailand’s credibility. That means it will become more expensive for Thailand to borrow money from overseas. In addition, the interest rate on both government and corporate bonds would have to become higher in order to accompany the higher-risk premium.

via SET: Bourse chief concedes political turmoil affects Thailand’s credit ratings.

hailand’s equity market bounced back strongly from the global crisis in 2009, with a total shareholder return (TSR) of 90.8% for the year against a 36% decline the year before. Ultra-lax monetary policies and massive public spending across the globe helped spur a quick turnaround from the worst global downturn since the Great Depression.

With economic pundits forecasting that Asian economies will lead global growth over the next few years, led by emerging giants China and India, it seems logical that investors will shift their funds to Thai and Asian equity markets in search of higher yields. Yet a glance through the 2009 Post/ AWR Lloyd-PYI Shareholder Scorecard shows that some sectors clearly benefited more than others.Homeand office products led all sectors with a 267% gain in 2009, followed by agribusiness at 238% and property development at 132%. Lagging the chart was paper and printing materials, with a -1.3% TSR for 2009, professional services with a meagre 4.5% gain, and property funds up 31%.

About the author

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Sign Up for Our Newsletter

Get notified of our weekly selection of news

You May Also Like

SET to list Nasdaq 100 Index DR and China’s STAR 50 Index DR

Investors can trade DR in Thai baht via existing securities accounts, with fee similar to trading Thai securities, all day without intermission session.

Thailand ranked 66th on UN Human Development Index

Thailand received a score of 0.8 on the index, with an average life expectancy of 78.7 years, an average of 15.9 years of education and a per capita income of 619,000 baht (US$17,000).

Asia’s Economies Face Weakening Growth amid Rising Inflation Pressures

Economic growth in Asia and the Pacific is projected to decelerate to 4.2 percent this year, 0.7 percentage points less than forecasted in April and slower than the 6.5 percent growth in 2021.