Last month, the Stock Exchange of Thailand (SET) found itself on an intriguing rollercoaster ride of volatility, largely due to unexpected developments on the global stage. As April rolled in, the brewing storm was set in motion by US President Donald Trump’s surprising tariff announcements. Just before the beloved Songkran festival, the SET plummeted to a worrying 1,056.41 points, nosediving like a bumpy carnival ride due to these surprising tariffs. This wasn’t just isolated to Thailand – global stock markets seemed to tremble at the news, like a global financial earthquake rippling across continents. Yet, there was a glint of gold, quite literally. Gold prices glimmered upwards past US$3,300, or roughly 113,190 baht per ounce, offering a shiny refuge in tempestuous seas.
Post-Songkran, the SET appeared to regain its footing, albeit unsteadily, and embarked on a gradual ascent against the backdrop of a US market slump exceeding 5%. The love for gold didn’t wane either, as prices glided up to US$3,500 (about 120,050 baht) before taking a modest step back. This upward trajectory of the yellow metal was underscored by its safe-haven allure amid uncertainty, much like a financial security blanket.
Amidst the market’s erratic behavior, a silver lining for the Thai banking sector materialized. Reports of first-quarter earnings surpassing expectations acted as a robust scaffold for the SET’s recovery, which elegantly closed at a monthly zenith of 1,197.26 points—a delightful 3.4% leap compared to the previous month. The volatility tango played out in the backdrop contributed to a 2.3% rise in the average daily turnover, which now amounted to a neat 40 billion baht.
President Trump’s tariffs took many by surprise with their intensity. A collective gasp echoed globally as shockwaves spread across international markets. Yet, a diplomatic gamble followed as Trump opted for a 90-day delay on most tariffs, albeit with a menacing 10% base tariff on most imports. The narrative grew complex with the US slapping on a staggering 145% tariff on China, met with a counter of 125% from the Asian giant—like a heavyweight trade match that neutralized incentives, a tumultuous tango between two global behemoths.
Amidst this trade storm, exploratory talks aimed at negotiation are brewing like an intriguing plot twist scheduled in picturesque Switzerland. Some nations are even considering solo deals in a bid to alleviate the tariff-induced economic chokehold.
The US economy felt the pinch as GDP dipped, courtesy of a spike in imports before the tariff limelight. In a related plot twist, the West Texas Intermediate crude price plunged below US$60 (around 2,058 baht) a barrel, driven lower by demand fears and OPEC+’s strategic production boost to reclaim market clout. Meanwhile, the dollar staggered in the currency wrestling match, giving way as Asian currencies, including our very own baht, flexed their strength, pegged at around 32.70 to the dollar.
With April’s grace period closing, Thailand slipped into a crucial results season. An optimistic reveal saw Thai banks reporting first-quarter profits about 10% higher than anticipated. However, looming uncertainties continue to cast shadows, tiptoeing as monetary policy plays its high-stakes game. Late April witnessed the Bank of Thailand’s strategic move, curtailing the rate by 25 basis points to land at 1.75%, whispering of potential further trimming to below 1% within the year’s second act.
Exports risk faltering beneath the weight of tariffs, and the tourism voice wanes, as Chinese arrivals slump 20-30% compared to last year. As these pivotal growth levers stutter, the central bank stands poised for potential actions, navigating these turbulent waters with a keen eye on sustaining the economic tempo.
Against a backdrop of swirling uncertainties, investment strategies are honing in on resilient stocks grounded in solid fundamentals and tuned to domestic rhythms. Top performers take center stage, with Bangkok Expressway and Metro (BEM), CP All (CPALL), Gulf Development (GULF), and Food Moments (FM) catching investors’ discerning eyes.
BEM’s first-quarter profit is projected at 871 million baht, a modest climb of 3% YOY and a cappella quarter-on-quarter. Despite the shadows of an expressway collapse and the rumble of seismic uncertainties, BEM looks primed for a second-quarter blossom, showcasing resilience in adversity.
CPALL’s retail and wholesale wings are elevating, whispering of a 6.8 billion baht net profit burgeon for the first quarter, a vibrant 8% YOY surge. Unfazed by tourism’s dance of uncertainty, CPALL alpha-struts for Thai ESGX funds with its broad market appeal.
GULF, riding high on its merger with INTUCH, presents a thoughtfully curated balance sheet narrative, complemented by a net gearing of 0.89 times. GULF, with its crescendoing renewable energy pursuits, is further stitched into the expansion tapestry by an expanded 3.49% stake in KBANK.
FM is poised as an export sensation, showcasing a first-quarter scintillation with a net profit stately crescendo of 185 million baht, applauding a 52% YOY climb and a gentle 2% quarter applause. With a price/earnings ratio of 6 times serenading investors and coupled with high dividend dexterity, FM sneaks in as a valuable string in the investment symphony, as chronicled by the Bangkok Post.
I’m really worried about what this means for the Thai economy long-term. Tariffs are not just a temporary glitch!
Tariffs can have lasting effects. Look at what happened in the 1930s!
But aren’t today’s markets more resilient and interconnected than back then? Maybe this won’t end in a recession.
The interconnectedness could make things worse since the ripple effect is bigger.
It’s clear we need more investments in domestic markets, not just hoping on gold every time there’s a crisis.
Maybe it’s time to start looking at cryptocurrencies as a real hedge, not just gold.
Cryptocurrencies lack the stability gold offers. Gold has centuries of trust built into it.
Yet crypto offers decentralization which might be crucial in geopolitical crises. Young investors are turning to it for a reason.
That’s exactly what I was thinking! Plus, crypto has the potential for higher returns.
I believe the SET recovery post-Songkran shows Thailand’s economy is quite resilient.
For now, maybe. But can it withstand more international pressure or another tariff twist?
Don’t forget the impact on tourism, if that doesn’t recover, resilience might be an illusion.
That’s true, but strategic investments might cushion the blow. Look at the banking sector’s growth.
Why are we even talking about GDP in the context of stock volatility? Isn’t corporate performance what’s really key here?
Corporate performance gets affected by GDP levels. Lower GDP means less consumer spending and smaller profits!
GULF and CPALL seem like solid picks amidst all this chaos. Their fundamentals are sound.
Thailand needs to focus on boosting tourism again. That’s the lifeline for many there!
Shouldn’t tech companies be entering the Thai market more aggressively now? Seems like an opportunity!
Tech sectors can thrive in Thailand with the right government incentives, especially in digital finance.
But remember, tech also depends on stable international relations, which aren’t in our favor right now.
Anyone else think Trump’s tariff decisions are just strategic blunders?
BEM’s resilience after an expressway collapse is commendable! Just goes to show infrastructure is key.
Exactly! Investing in infrastructure stocks is smart as they form the backbone of economic recovery.
Is no one commenting on the impact of this on the US dollar? It’s weakening could be strategic or a sign of deeper issues.
Gold’s value now surpassing $3500! Who would have thought we’d see this so soon?
With the current political tensions, it was bound to happen sooner or later.
The strength of Asian currencies over the dollar signals a shift in global power dynamics, excitement ahead!
Maybe, but the long-term effects of a shifting power economy are uncertain, best not to get too hyped.