END OF TARIFF UNCERTAINTY UNLOCKS SET

July was an unusual month for Thai equities as the low point of the month for the SET index occurred on the first day and the high point on the last day, with a wide trading range between 1,086.56 and 1,251.16 points.

- TISCO SECURITIES

In first half of the month, market movement was sideways up as investors were fixated on tariff news. Some panic set in when Vietnam became the first country in the region to settle an agreement with the US for an import tariff rate of 20%, well below the 36% rate Thailand was facing.

When Indonesia was assigned a 19% tariff rate, worries about Thailand's competitiveness grew, but the government assured the public that negotiations were going well and Thailand’s final rate would be competitive.

Stock markets worldwide, especially the Nasdaq, rallied during the month, providing some positive sentiment to the SET as well.

Cheap valuations have been an attraction for the SET, which has been down as much as 20% from the start of the year at some points.

Meanwhile, expectations that a new Bank of Thailand governor could take a more dovish approach to interest rates helped push the SET beyond 1,200 points. Decent second-quarter earnings announced by banks were a positive factor in the second half of the month, as were rumours that Thailand would see a final US tariff rate of 19%.

The SET closed the month at 1,242.35 points, up 14% from the end of June, with average daily turnover increasing 7.3% to 42 billion baht.