The Stock Exchange of Thailand (SET) will not abolish measures to prohibit intra-day and margin-loan trading on stocks that have prices and volumes that move irregularly.

"We think it is still a necessary measure," Supakit Jirapraditkul, senior vice president for market regulation, said yesterday.

Recently, SET president Patareeya Benjapholchai said the stock exchange would review whether the measure would be implemented further.

International Engineering (IEC) early this year filed legal action against the SET after its stock was banned from intra-day and margin-loan trading and suspended from trading for five days after allegations of irregular stock movements. The Supreme Court later overturned an earlier ruling by the Central Administrative Court that temporarily revoked the SET's order against IEC shares.

Supakit warned that the SET was monitoring stocks that had moved in a way that suggested speculation on a day-by-day basis.

"I don't want to mention how many stocks are being closely monitored by us, because it may lead to investor speculation and have an impact on the overall stock market," he said.

Market observers have raised eyebrows over the surveillance, because the SET has not implemented any measures to stop stock speculation since executive vice president Suthichai Chitvanich, who once headed the Market Regulation Division, was placed in charge of corporate governance in September.

Supakit explained that the stock exchange had no arbitrary mandate to choose when it would use the measures, but stock speculation by its very nature would not be active during sluggish market conditions and would be revitalised during periods of euphoria.

"It's a preventive measure, and we must consider the appropriateness of implementation. We're like a referee - the audience would become bored if we stopped the game often, while the game might suffer if we let it run without any intervention," he said.

Oranan Paweewun

The Nation