Thailand Market Slips as Central Bank Flags Growth, Inflation Risks

Thailand’s SET50 Index lost around 0.5% in early Thursday trade, hovering near 966 after gains in the prior session. Sentiment weakened after the central bank left its policy rate unchanged at 1% on Wednesday, but cautioned that fallout from the Middle East war could slow domestic economic growth this year to 1.5%. Inflation is also expected to rise while credit conditions remain subdued. In the U.S., the Fed held rates steady for a third meeting, though four officials dissented. Locally, markets are on track for a second straight monthly decline, down about 0.2% so far, after a steep fall in March. Energy minerals, consumer services, and retail trade provided support even as producer manufacturing and consumer durables weighed. Major laggards included TISCO Financial Group (-3.0%), Airports of Thailand (-2.9%), and Kiatnakin Phatra Bank (-1.25%). Markets will be closed on Friday for National Labor Day.

Thailand's SET 50 Index fell 13 points or 1.3% to 957 on Thursday afternoon, extending losses from the prior session and nearing a three-week low. A sharp drop in U.S. stock futures pressured sentiment, despite Wall Street closing at another high on Wednesday following President Trump’s extension of the U.S.–Iran ceasefire. Traders largely brushed aside supportive developments, including Moody’s upgrade to Thailand’s outlook, as foreign outflows persisted. Concerns also mounted over the country’s fragile growth trajectory, expanding just 2.4% last year and lagging regional peers. Meanwhile, Finance Minister Ekniti Nitithanprapas noted that policy space is limited, with public debt at 66% of GDP, close to the 70% ceiling, raising fears it may need to be lifted. Industrial services, process industries, transport, and consumer services led the decline. Major laggards included Siam Cement (-7.7%), Thai Oil (-3.9%), Gulf Development (-3.4%), and Delta Electronics (-3.3%).

Thailand’s SET 50 Index plunged 8% to around 900 points on Wednesday, hitting a four-week low, as intensifying conflict in the Middle East sparked a sharp risk-off wave across Asian markets. The steep drop triggered a 30-minute trading halt on the Stock Exchange of Thailand, with rules stipulating another suspension if losses deepen to 15%. Investors are increasingly uneasy about the duration and economic fallout of the Iran war, particularly for Thailand, one of the region’s most energy import-dependent economies, while potential airspace disruptions threaten the country’s vital tourism sector. The selloff has also effectively erased the nearly 14% rally that followed Prime Minister Charnvirakul’s decisive election victory last month. Losses were compounded by an unwind in AI-linked plays, with Delta Electronics, down 12.7%, among the major drags. Other notable losses came from heavyweight names, such as Gulf Development and Airports of Thailand, dropping around 10% each.