Thailand’s Stock Index Nears Bear Market Territory Amid Economic Concerns
Thailand’s benchmark stock index teetered on the edge of a technical bear market as worries about the country’s economic growth trajectory weighed on investor sentiment. The Stock Exchange of Thailand Index closed 1% lower on Friday, nearing a 20% decline from its October peak, a key threshold for a bear market.
Shares of Delta Electronics Thailand Pcl and Advanced Info Service Pcl were among the top contributors to the index’s slide, reflecting broader concerns about the health of the Thai economy. Foreign investors have been selling off stocks in Thailand, the worst performing equity market in Asia in 2025, withdrawing nearly $10 billion over the past two years.
The lackluster performance of the SET index is seen as a reflection of the weak Thai economy, with government policies failing to drive structural improvements. Pon Van Compernolle, managing partner at RVC Emerging Asia Fund, noted that the ongoing selling pressure from foreign and local institutions is indicative of a lack of faith in the capital markets.
Global funds have offloaded $381 million worth of Thai shares so far this year, according to Bloomberg data. The country’s vulnerability to retaliatory tariffs from the US, given its higher import levies on American goods, has added to the economic uncertainty.
Prime Minister Paetongtarn Shinawatra has called for closer collaboration between the Bank of Thailand and the Finance Ministry to bolster growth and protect Thailand’s trade interests. The recent threats of tariffs by US President Donald Trump have further dampened investor sentiment, leading to a broader selloff in the region.
In addition to economic concerns, high consumer debt levels and corporate governance issues have also weighed on the Thai market. John Foo, founder of Valverde Investment Partners Pte, highlighted the challenges posed by persistent consumer debt and governance issues affecting popular stocks held by foreign investors.
The drop in Thai stocks is part of a larger selloff in the region, with Indonesia’s benchmark index also entering bear market territory. The MSCI Asean index has seen a more than 10% decline from its peak in September, reflecting the broader impact of global trade tensions on Southeast Asian markets.
As Thailand grapples with economic headwinds and external pressures, investors will be closely watching for signs of stability and growth in the coming months. The government’s efforts to shore up the economy and protect trade interests will be crucial in restoring confidence in the Thai market.
This article was updated with the latest closing price and analyst comments.
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