Published On: Fri, Jun 10th, 2011

Thai Bourse Operating Performance in May 2011

The Stock Exchange of Thailand (SET) Index closed May at 1,073.83, a 1.80% drop over the previous month, but a 3.98% rise over end-2010, the second-highest rise in Asia (after South Korea). Decreasing stock prices lowered its forward P/E ratio to be at 12.42 times, second-lowest in Asia (after South Korea). However, the SET still offered the highest dividend yield in the region, at 3.57%.

Combined SET and the Market for Alternative Investment (mai) daily average trading value was THB32.66 billion (approx. USD1.08 billion), a 9.32% drop over the previous month. Meanwhile, the derivatives market daily average trading volume was at 36,815 contracts, the highest trading volume since the market started trading.

The SET Index’s May dip was in line with other regional exchanges, due to investor concerns over Greece’s downgraded long-term credit ratings, which pressured trading activity in all markets worldwide, making the funds to flow into low-risk asset markets. Thus, in May 2011, foreign investors on the SET had a net sell position of THB16.70 billion (approx. USD505.92 million). In particular, funds ran to gold, helping push gold futures trading to a new high since it commenced trading. Daily average trading volume of 50-Baht weight and 10-Baht weight gold futures surged 39.52% and 25.99%, respectively.

The May drop in the SET Index resulted in a decrease in SET market capitalization to be at THB8.74 trillion (approx. USD264.87 billion), down 1.34% over the previous month, while mai market capitalization was at THB76.51 billion (approx. USD2.32 billion), up 7.42% over the previous month, due to the trading resumption of Energy Earth PCL (EARTH) securities after the company was suspended from trading in 1999. As of end-May 2011, the SET’s forward P/E ratio was 12.42 times, down from 12.85 times in the previous month.

Meanwhile, the SET’s dividend yield remained high at 3.57%, while mai’s dividend yield was at 2.99%, down from 3.90% in the previous month.

The Industry Group indices that dropped lower than the SET Index were those in the Industrials, Resources, and Property & Construction Groups, which dropped 5.74%, 3.43% and 3.07%, respectively, over the previous month due to the decrease in oil prices and upward interest rate trend.

Although the combined SET and mai daily average trading value was down 9.32% over the previous month, it was a 36.58% surge over the same period last year.

Foreign investors were net sellers of THB16.70 billion (approx. USD505.92 million). However, during January to May 2011, foreign investors remained net buyers of THB12.13 billion (approx. USD367.66 million). Meanwhile, individual investors, institutional investors, and proprietary trading remained net buyers in May 2011.

A breakdown on trade by market capitalization and Industry Group shows that in May, the proportion of trade flowing to small-cap stocks, which were Non-SET50, increased to 35.79% of total trading value, up from 29.84% in the previous month. Accordingly, the trade proportion of securities in SET-10 and SET11-30
decreased, particularly in the Banking and Property Development Sectors.

In May 2011, the derivatives total trading volume was at 662,663 contracts, a daily average trading volume of 36,815 contracts, the highest since the market started trading, and a 20.43% surge over the previous month. The five-month daily average trading volume in 2011 posted a 58.45% surge over 2010’s daily average trading volume. Every derivatives product rose in daily average trading volume over the previous month and also set new all-time highs, except for single stock futures. SET50 Index Options was the highest trading volume product, or a soar of 86.35% over the previous month.

Capital-raising in May 2011 by listed firms through equities reached THB8.29 billion (approx. USD251.19 million), consisting of THB4.06 billion (approx. USD123.02 million) through the initial public offering of LH Financial Group PCL (LHBANK), Khonburi Sugar PCL (KBS), and Sub Sri Thai Property Fund (SSTPF) and THB4.23 billion (approx. USD128.17 million) through secondary equity offerings.

Capital-raising during January to May 2011 reached THB55.98 billion (approx. USD1.67 billion), a 79.69% surge over the same period last year.

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