Commerce Minister Urges Investors Not To Panic As Thai Stocks Fall Sharply

[webfact]

Commerce Minister urges investors not to panic as Thai stocks fall sharply

BANGKOK: - Deputy Prime Minister and Commerce Minister Kittirat Na-Ranong on Monday urged investors not to panic after the Stock Exchange of Thailand (SET) index plunged drastically by over eight percent mid-session on Monday, hitting their lowest level in more than a year.

The SET composite index fell by as much as 8.46 per cent, or 81.08 points, to 877.08 by early afternoon -- the highest one-day percentage drop since Oct 2008, at the beginning of the financial crisis.

The exchange has fluctuated continuously with a reduced volume of buying and selling since last week, which Mr Kittirat later said at a seminar here on the economy and investment on Monday that the situation may have resulted from foreign investor concern.

Most investors dumped their shares to shift investment to other regions as they were unsatisfied with US measures on economic stability and Europe's debt crisis, Mr Kittirat commented.

In an attempt to allay investors' concern, the minister said that Thailand's economic fundamentals remain strong. The situation is being closely monitored by the Thai bourse itself, the commerce ministry and other agencies. He said it is apparently the right time for foreign investors to invest in the Thai bourse.

Meanwhile, Krungsi Asset Management Co Chief Investment Officer Prapas Tonpibulsak said the SET index dropping sharply Monday morning was unusual and should not have resulted from the fragile global economy.

He said the continuous index fall may have resulted from Thai shares in the past two months adjusting less than other regional bourses.

Thai shares fell only 10 per cent, while region-wide stock indices dropped 15-25 per cent.

Mr Prapas asserted that the Thai stock index plunge this time was unlike the 1997 ‘Tom Yum Kung Crisis’ or the 2008 ‘Hamburger Crisis,’ as Thailand's fundamentals remain strong and there are currently a variety of investors in the market.

He urged the government to adopt proactive strategies to help boost the confidence of foreign investors.

Investors viewed the Thai stock index as being in positive territory at 1,200 points. However, Europe's debt woes have caused increasing asset prices, particularly gold, resulting in investors' deep concerns regarding the global economy.

Mr Prapas anticipates the SET index this year might close lower than the previous year at 1,033 points. If Thai share prices continue to drop, it would result in even lower Price-Earnings Ratio (P/E Ratio).

The investment officer also advised investors to commit their funds to the long term of 2-3 years, closely monitor the situation and consider whether to unload their portfolios.

The expansion of losses in stocks was seen all over Asia, for investors were not satisfied with the economic situation worldwide. According to the Associated Press, investors "were left unimpressed by a commitment at the weekend from G20 finance chiefs that they would take strong, coordinated action to tackle the market turmoil."

As the SET closed Monday, the Thai stock index fell 54.10 points or 5.65 per cent to close at 904.06, in trade worth Bt47,630 million. (MCOT online news)

-- TNA 2011-09-27

[webfact]

Euro-zone fears: markets in tailspin

SIRIPORN CHANJINDAMANEE

THE NATION

Capital-market organisations proposed the establishment of a fund yesterday to support the stock market, in the absence of collective action to end the euro-zone crisis, which threatens to induce further plunges in global bourses, including that in Thailand.

The Stock Exchange of Thailand yesterday lost as much as 9.42 per cent, which triggered a technical trading halt. In its 36-year history, the exchange’s circuit breaker has been thrown only twice before – in 2001 after the terrorist attack in the United States and in 2006 after the launch of capital controls.

At yesterday’s close, the SET Index had rebounded to 904.06 points for a narrower loss of 54.10 points, or 5.65 per cent.

Yesterday was the third day of dramatic tumbles on the Bangkok bourse sparked by concerns over the US and European economies, which are major markets for Thai exports. On Thursday, the Stock Exchange of Thailand Composite Index lost 3.79 per cent to 990.59 points and on Friday it lost a further 3.27 per cent to 958.16 points.

The three days of losses, representing a plunge of 11.1 per cent, has wiped Bt1.02 trillion off the market’s capitalisation, bringing it down to Bt7.4 trillion.

After yesterday’s panic selling of Thai stocks, the Federation of Thai Capital Market Organisations (Fetco) proposed the establishment of a Vayupak 3 Fund worth about Bt100 billion and a review of the government’s populist measures (details, page 2A).

“Establishing a Vayupak Fund 3 will help to develop the capital market in the long term,” said Fetco president Paiboon Nalinthrangkurn. “The government will earn money through its reduction of holdings in state enterprises while investors will be able to buy stocks at bargain prices.

Stock focuses include Thai Airways International, MCOT and PTT. The fund size could be Bt100 billion, similar to that of Vayupak 1 and 2.”

Fetco is of the view that global market volatility will remain for some time, without collective action to end the cri sis and with clear signs that both the United States and Europe lack weapons to boost the economy.

According to Securities Analysts’ Association secretary-general Sombat Narawutthichai, 170 Thai stocks are now trading below their fundamentals. The association is now in the process of revising its end-of-year SET Index forecast, given that euro-zone factors have become worse over the past two months. Earlier, some securities houses expected the index to end the year at 1,200 points.

Fetco’s proposal for the establishment of a support fund was flatly rejected by Deputy Prime Minister Kittiratt Na-Ranong – a former president of the stock exchange. He said on the sidelines of a seminar yesterday that the government had no policy to bail out the market.

He said yesterday’s Thai-market plunge looked frightening because of narrower losses on the first two days, compared with the losses of other Asian bourses. However, he said the plunge offered a good opportunity for buyers.

SET president Charamporn Jotikasthira said after discussions with brokerage houses that yesterday’s market fall made the Thai bourse’s loss equal to those in Indonesia and the Philippines. In the past five days, Indonesia and the Philippines have lost 11.6 per cent and 13.6 per cent of market value respectively.

He insisted that short-selling had not contributed to the tumble.

Foreigners remained net sellers yesterday, with a net-sell position of Bt3.03 billion, as they left emerging markets and returned to dollar assets. So far this month, the net sells have exceeded Bt18 billion.

The baht also plunged below 31 to the US dollar yesterday, to 31.17, the weakest level since January 31. Gold shed more than $100 per ounce to $1,532.72.

Oil prices also fell to a seven-month low, on bets Europe’s sovereign-debt crisis would cut fuel demand. Crude for November delivery on the New York Mercantile Exchange fell as much as $2.74 to $77.11 a barrel, the lowest price since August 9, and was at $79.31 at 10.24am London time. Oil is down 13 per cent this year in New York.

A senior broker at Jefferies Bache in London, Christopher Bellew – who correctly predicted Brent wouldn’t exceed $120 this summer – said that short-term panic could briefly push Brent below $100, but growth in Chinese demand was likely to prevent prices falling through the floor.

World stock markets remained volatile yesterday as investors grew increasingly convinced that Greece would default on its debts – an event that economists say has the potential to worsen the global downturn.

Global panic was sparked by default fears that originated from a string of bad news following the International Monetary Fund’s meeting last weekend. The Group of 20 expressed worries over the absence of a solution to ease the European debt crisis and big-time investor George Soros mentioned that the world was slipping into recession and the euro-zone debt crisis was now more severe than the US economic malaise.

The most frightening news came from IMF managing director Christine Lagarde, who said the fund’s $384-billion lending chest might not be enough to meet all loan requests if the global economy worsened.

According to polls released in Sunday editions of Greek newspapers To Paron and Proto Thema, most Greeks expect the country won’t be able to avoid defaulting on its public debt.

Lagarde yesterday met with Greek Finance Minister Evangelos Venizelos in Washington. They discussed the terms under which the IMF mission would return to Athens to undertake a fifth review of Greece’s economic programme – most likely this coming week.

To soothe markets, German Chancellor Angela Merkel said euro-region leaders must erect a firewall around Greece.

Greece has yet to secure a second international bail-out amid questions about its ability to satisfy the terms for aid. Venizelos this month announced a raft of new measures including pension and wage cuts as well as a sweeping property tax to ensure the nation meets 2011 targets to qualify for a sixth loan payment in October under its first May 2010 financing package.

Transport came to a standstill in the Greek capital yesterday as unions staged the latest series of 24-hour strikes against the government’s austerity drive, leading to long queues on the streets of Athens as commuters drove to work, according to Deutsche Presse-Agentur.

-- The Nation 2011-09-27

[siampolee]

BANGKOK: - Deputy Prime Minister and Commerce Minister Kittirat Na-Ranong on Monday urged investors not to panic after the Stock Exchange of Thailand (SET) index plunged drastically by over eight percent mid-session on Monday, hitting their lowest level in more than a year.

He said it is apparently the right time for foreign investors to invest in the Thai bourse.

Stocks and shares are no different to gambling on the horses or dogs or cock-fighting etc etc.

There is a record of past performance, however we see other outside factors arise and the form is shot to pieces,as we see now and have seen in the past those factors are international influences..

After yesterday's panic selling of Thai stocks, the Federation of Thai Capital Market Organisations (Fetco) proposed the establishment of a Vayupak 3 Fund worth about Bt100 billion and a review of the government's populist measures (details, page 2A).

"Establishing a Vayupak Fund 3 will help to develop the capital market in the long term," said Fetco president Paiboon Nalinthrangkurn. "The government will earn money through its reduction of holdings in state enterprises while investors will be able to buy stocks at bargain prices.

Read ,

The rich elite will yet further control the country and its people due to the selling off of national assets.

Edited September 27, 2011 by siampolee

[Thai at Heart]

BANGKOK: - Deputy Prime Minister and Commerce Minister Kittirat Na-Ranong on Monday urged investors not to panic after the Stock Exchange of Thailand (SET) index plunged drastically by over eight percent mid-session on Monday, hitting their lowest level in more than a year.

He said it is apparently the right time for foreign investors to invest in the Thai bourse.

Stocks and shares are no different to gambling on the horses or dogs or cock-fighting etc etc.

There is a record of past performance, however we see other outside factors arise and the form is shot to pieces,as we see now and have seen in the past those factors are international influences..

After yesterday's panic selling of Thai stocks, the Federation of Thai Capital Market Organisations (Fetco) proposed the establishment of a Vayupak 3 Fund worth about Bt100 billion and a review of the government's populist measures (details, page 2A).

"Establishing a Vayupak Fund 3 will help to develop the capital market in the long term," said Fetco president Paiboon Nalinthrangkurn. "The government will earn money through its reduction of holdings in state enterprises while investors will be able to buy stocks at bargain prices.

Read ,

The rich elite will yet further control the country and its people due to the selling off of national assets.

Are you gaga? Stocks and shares are no better than betting?

Well how about selling EGAT or the trains to foreign companies who might actually know how to run them efficiently? If they are going to flog national assets, they may as well flog them to someone who might actually have a clue what to do with them.

[geriatrickid]

The above two posts demonstrate the feud that goes on everywhere; One side says the state should not own assets better left to the private market and the other side states that the government should hold the assets assets. Plays out everywhere. There are far too many state owned enterprises. it might benefit the nation to privatize the railways and some non core assets.

The one intelligent comment; Fetco's proposal for the establishment of a support fund was flatly rejected by Deputy Prime Minister Kittiratt Na-Ranong – a former president of the stock exchange. He said on the sidelines of a seminar yesterday that the government had no policy to bail out the market. We saw how well the market bailouts went in the EU and USA. As soon as the banks and over extended financial nasties like AIG had the breathing room, they went right back to awarding their senior officers massive obscene bonuses. I think the Deputy PM is right. His view is shared by the finance ministers in Canada and Sweden. Considering the fact that Canada is the only G8 economy on semi solid ground and Sweden is holding up, he's in good company. If people want to play the stock market, then they must accept the risk that accompanies such investments.

Edited September 27, 2011 by geriatrickid

[Thai at Heart]

The above two posts demonstrate the feud that goes on everywhere; One side says the state should not own assets better left to the private market and the other side states that the government should hold the assets assets. Plays out everywhere. There are far too many state owned enterprises. it might benefit the nation to privatize the railways and some non core assets.

The one intelligent comment; Fetco's proposal for the establishment of a support fund was flatly rejected by Deputy Prime Minister Kittiratt Na-Ranong – a former president of the stock exchange. He said on the sidelines of a seminar yesterday that the government had no policy to bail out the market. We saw how well the market bailouts went in the EU and USA. As soon as the banks and over extended financial nasties like AIG had the breathing room, they went right back to awarding their senior officers massive obscene bonuses. I think the Deputy PM is right. His view is shared by the finance ministers in Canada and Sweden. Considering the fact that Canada is the only G8 economy on semi solid ground and Sweden is holding up, he's in good company. If people want to play the stock market, then they must accept the risk that accompanies such investments.

Well, I think the worst case scenario is that if these companies, they are offered ONLY to Thai investors. These companies are in dire need of investment capital, particularly the trains. And believe it or not (specificially the trains), I would believe a foreign company negotiating with the government about investment plans and ticket pricing infinitely more than a Thai group. Of course for some bizarre reason profit taking by Thais is seen as in the national interest, but for foreigners to do the same is seen as some crime.

The bailouts in Europe and the US have been completely ineffective, and shown that moral hazard is a very real problem. I can't help feeling that the bailouts were put in place simply to save Goldman. We were told it would be an economic doomsday without QE, but what is the difference today? Europe is effectively bankrupt, and the US is up to its eyes in debt with no growth and 9% unemployment.

Edited September 27, 2011 by Thai at Heart

[webfact]

Commerce Minister: No Need for Measures to Deal with Plunging Bourse

The commerce minister says the steep fall in the Thai stock index yesterday was the result of investors' concern over debt problems in the U.S. and Europe.

He added that Thailand's economic fundamentals remain strong and it is still not necessary to take new measures.

Commerce Minister Kittirat Na Ranong said the continued sharp decline in the Thai stock index since the end of last week is due to a massive sell-off by foreign investors who are concerned about the struggling economy in the U.S. and Europe.

Kittirat suggested that local investors continue to monitor overall trading activities for a period of time, and not to be alarmed by the current situation since Thai economic fundamentals remain strong.

He noted that related agencies such as the Stock Exchange of Thailand and the Finance Ministry have been monitoring the situation closely, and he agreed that it's still not necessary to impose any special measures, as the fall does not affect the stability of the Thai stock market.

Meanwhile, Prapas Tonpibulsak, Krungsri Asset's chief investment officer, commented that the steep drop in the Thai bourse is abnormal and is likely temporary.

Prapas observed that the decline of the Thai stock index is relatively small when compared to other stock markets in Asia.

The Thai stock index fell 10 percent, while other stock markets in the region dropped by 15 to 25 percent.

Yesterday's decline brought the Thai stock index in line with other Asian indices.

He noted that the fundamentals of the Thai bourse remain strong and foreign investor confidence will improve if the government rushes to issue proactive measures.

-- Tan Network 2011-09-27

[saroq]

"Stocks and shares are no different to gambling on the horses or dogs or cock-fighting etc etc."

"There is a record of past performance, however we see other outside factors arise and the form is shot to pieces,as we see now and have seen in the past those factors are international influences."

Clearly the author of this post (above) does not understand the stock market or how to make money in it. The four letter word you are looking for to protect your profit is "sell" and if you'd like to profit in a falling market the you want to "short" the particular share you are trading.

Edited September 27, 2011 by saroq

[siampolee]

saroq.and Thai at Heart not forgetting G.K. who is an expert on all thing it would seem

.

Never judge others by your standards. I played the U.K. stock market for a good many years and made a considerable amount of money, (on which I paid tax I hasten to add) which has indeed enabled me and my family to live in the style we were accustomed to many years ago..Both in the U.K. and also in Thailand. That which my family own here is as a result of my efforts elsewhere

I still am an active investor even now, indeed it is the time to hang on to ones hat and ride out the storm, a time to buy and hold . Bear in mind though the stocks one buys.

I was for some years a partner in Lloyds of London syndicates, I got out before it all went bad as I saw some bad times coming and of course I was fortunate in that I wasn't involved in natural disaster coverage matters.

I repeat my comment , for the uninitiated the stock market . like Lloyds syndication is nothing more than a bookmakers office and for the more experienced it is the same,.Tips, form, etc. etc.

Who are the the trainers (directors) who are the jockeys (managing director), the stables ( the company)

All it needs is a fall at the first fence by the favourite and all is lost.

Faulty products, a shortage of raw materials, industrial unrest, such matters do not appear in the form books of commerce. One needs, indeed has to be on the ball all the time reading the signs in the business press and assorted investment and trade journals, listen to political leaders and the union spokesmen or spokeswoman, rumours undermine companies.

The business world is now truly international and the enthusiastic amateur is likely to lose his or hers nest egg in one foul swoop if they make the wrong judgement or hold too many options at the wrong time.

Nick Leeson showed us all how it could happen as has someone else in the last week or so, the bankers , mortgage brokers and assurance and insurance companies didn't do to well either, experts or gamblers one is tempted to ask ?.

Remember though , never buy if you can't afford to loose in the short term or sometimes in the long term.

If you saw me you would indeed understand why although I have all my hair at 66 years of age it is grey !!

[ParadiseLost]

He noted that the fundamentals of the Thai bourse remain strong and foreign investor confidence will improve if the government rushes to issue proactive measures.

I am sure there are legions of 'foreign investors' just chomping at the bit to dive into this cesspool...

Thank Buddha, the government is expediting the boom times:- interference in the rice market, empty election promises, raising minimum wages, backtracking on important rail projects, etc. etc...

Sure these actions will be making potential investors very interested.

But no problem - o brother (where art though?) will dial in to save the day

[Bagwan]

Why all this fuss? Mere bagatelle compared to The Great Tea Trolley Disaster at the Chester Perry Organisation in the 1970's. Messrs Bristow and Jones were at their wit's end and Gordon Blue nearly resigned.

[lungmi]

saroq.and Thai at Heart not forgetting G.K. who is an expert on all thing it would seem

.

Never judge others by your standards. I played the U.K. stock market for a good many years and made a considerable amount of money, (on which I paid tax I hasten to add) which has indeed enabled me and my family to live in the style we were accustomed to many years ago..Both in the U.K. and also in Thailand. That which my family own here is as a result of my efforts elsewhere

I still am an active investor even now, indeed it is the time to hang on to ones hat and ride out the storm, a time to buy and hold . Bear in mind though the stocks one buys.

I was for some years a partner in Lloyds of London syndicates, I got out before it all went bad as I saw some bad times coming and of course I was fortunate in that I wasn't involved in natural disaster coverage matters.

I repeat my comment , for the uninitiated the stock market . like Lloyds syndication is nothing more than a bookmakers office and for the more experienced it is the same,.Tips, form, etc. etc.

Who are the the trainers (directors) who are the jockeys (managing director), the stables ( the company)

All it needs is a fall at the first fence by the favourite and all is lost.

Faulty products, a shortage of raw materials, industrial unrest, such matters do not appear in the form books of commerce. One needs, indeed has to be on the ball all the time reading the signs in the business press and assorted investment and trade journals, listen to political leaders and the union spokesmen or spokeswoman, rumours undermine companies.

The business world is now truly international and the enthusiastic amateur is likely to lose his or hers nest egg in one foul swoop if they make the wrong judgement or hold too many options at the wrong time.

Nick Leeson showed us all how it could happen as has someone else in the last week or so, the bankers , mortgage brokers and assurance and insurance companies didn't do to well either, experts or gamblers one is tempted to ask ?.

Remember though , never buy if you can't afford to loose in the short term or sometimes in the long term.

If you saw me you would indeed understand why although I have all my hair at 66 years of age it is grey !!

seconded.

I modify (if you give me the copyright):

The most dangerous animal for mankind is a banker.

[saroq]

Thank you for acknowledging my superiority and knowledge of all things. To suggest that the stock market is akin to dog racing, horse racing or any gambling of that type is not correct. With stocks you get to place your bet after they have left the gate and you know who is ahead. The only thing unknown it how long the race will be but you can get out and take your winnings at any time, you don't have to wait for the end of the race. Perhaps I'm just better at it than you are siampole.

Only a fool would let someone else manage his/her money. A lesson I learned the hard way but I've never come up short managing my own investments / trades.

Edited September 28, 2011 by saroq