Analysts see buoyant SET following rate cut

Analysts are lifting Stock Exchange of Thailand (SET) index estimates for 2026 after the Monetary Policy Committee (MPC) cut the policy rate by 25 basis points (bps) to 1.00%, the lowest level in nearly four years, triggering expectations of a market re-rating.

- NUNTAWUN POLKUAMDEE

Asia Plus Securities raised its year-end SET index target to 1,580 points from 1,440 based on a 5% market earnings yield gap assumption. The upgrade adds 60 index points as a result of the unexpected rate cut and 80 points from upgrading its 2026 earnings per share forecast to 95 baht from 90 baht.

Vathan Jitsomnuk, strategist at Pi Securities, described the move as a surprise given fourth-quarter 2025 GDP growth of more than 2%, recovering tourism and no clear signal of easing from the US Federal Reserve.

However, he said the central bank's statement reflects economic fragility. Export growth remains concentrated in electronics, overall GDP growth of around 2% is below the historical 3-4% potential, and credit conditions remain tight for small businesses and vulnerable households.