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Thai Stock Market Called Lower On Thursday

2/29/2012 9:14 PM ET

The Thai stock market has moved higher now in consecutive trading days, climbing more than 25 points or 2.4 percent in the process. The Stock Exchange of Thailand finished just above the 1,160-point plateau, and now investors are expected to take some money off the table when the market opens on Thursday.

The global forecast for the Asian markets suggests mild consolidation, with investors likely to lock in gains after stocks rallied earlier in the week - particularly among the gold and technology stocks. Remarks by U.S. Federal Reserve Chairman Ben Bernanke add to the cautious sentiment as the Fed chief refrained from discussing further quantitative easing while testifying before the House Financial Services Committee. The European and U.S. markets finished with mild losses, and the Asian markets are expected to follow suit.

The SET finished sharply higher on Wednesday following solid gains from the financial shares and the energy producers.

For the day, the index surged 14.64 points or 1.28 percent to finish at the daily high of 1,160.90 after trading as low as 1,149.65. Volume was 4.737 billion shares worth 36.104 billion baht. There were 306 gainers and 184 decliners, with 151 stocks finishing unchanged.

Among the gainers, energy giant PTT was up 0.83 percent, while Bangkok Bank added 2.26 percent and Kasikornbank collected 1.03 percent.

The lead from Wall Street is negative as stocks showed a lack of direction for much of Wednesday before falling in late day trading and closing firmly in the red. The pullback by the markets was partly due to profit taking, with traders cashing in on recent strength amid ongoing questions about whether the global economic outlook supports the latest upward move.

Selling pressure was also generated by Bernanke's testimony before the House Financial Services Committee, as the Fed chief refrained from discussing further quantitative easing despite acknowledging that the pace of the U.S. economic expansion has been uneven and modest by historical standards. Bernanke also warned of lingering weakness in the labor market.

Traders largely shrugged off the release of a report from the Commerce Department showing that the U.S. economy expanded at an annual rate of 3.0 percent in the fourth quarter, reflecting an upward revision from the 2.8 percent growth that was initially estimated. The upward revision surprised economists, who had expected GDP growth to be unrevised.

A separate report from the Institute for Supply Management - Chicago showed that business activity in the Chicago-area expanded faster than expected in February. The ISM Chicago said its Chicago business barometer jumped to 64.0 in February from 60.2 in January, with a reading above 50 indicating an expansion. Economists had been expecting a reading of 61.0.

The major averages all ended the day in negative territory, with the Dow pulling back below the 13,000 level. The Dow fell 53.05 points or 0.4 percent to finish at 12,952.07, while the NASDAQ slid 19.87 points or 0.7 percent to 2,966.89 and the S&P 500 dropped 6.50 points or 0.5 percent to 1,365.68.

In economic news, Thailand will on Thursday announce the inflation rate for February, with forecasts expecting 3.5 percent - up from 3.38 percent in January. Core CPI is called steady at 2.75 percent.

Also, Thailand's production sector is improving gradually, the Bank of Thailand said in its monthly report on economic and monetary conditions on Wednesday. With the flood-affected manufacturing resuming partial production, the annual rate of contraction in manufacturing output slowed to 15.2 percent in January from 25.3 percent in December.

Marked improvements were observed in the automobile, hard disk drive, and integrated circuit industries, the central bank said. Consequently, the capacity utilization rate rose to 58.5 percent from 51.9 percent in the previous month.

by RTT Staff Writer

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