Stock trading rattled by uncertainty

Analysts predict a rocky 2025 for the local bourse, write Nareerat Wiriyapong and Nuntawun Polkuamdee

- 

Amid an imminent cabinet reshuffle and intensifying conflicts among coalition parties, the Thai stock market is again feeling the pressure of domestic political uncertainty just as global volatility about reciprocal tariffs ripples, say pundits.

Foreign investors have been heavy sellers in the Thai equity market since 2023, with net sales of 192 billion baht (US$5.5 billion) in 2023, 148 billion baht ($4.4 billion) in 2024 and 70 billion ($2.1 billion) this year-to-date, according to the Thai unit of China Galaxy Securities (CGS).

Last month, the Stock Exchange of Thailand (SET) index recorded another weak performance, as market sentiment was affected by frequent news updates about the trade war, while the Thai government decided to halt its digital wallet stimulus and direct the funds towards mid-term infrastructure development.

Year-to-date the bourse has declined 17.9%, attributed to unfavourable domestic and international factors that dampened investor sentiment.

"We believe a cabinet reshuffle is imminent, with Pheu Thai, the leader of the coalition government, likely to take back the Interior Ministry portfolio from coalition partner Bhumjaithai," said Kasem Prunratanamala, head of research at CGS International.

"With the tit-for-tat between the two parties, we believe the government is unable to function properly, especially in these tough economic times. Moreover, domestic economic uncertainty is likely to be exacerbated by the global trade tension."

SET president Asadej Kongsiri said investors value policy stability and clarity, and tend to react negatively to frequent changes or unclear government directions such as a cabinet reshuffle.