The Stock Exchange of Thailand's recent overseas "road show" received an enthusiastic response from foreign investors, according to its president, Patareeya Benjapolchai.

The rally in the Thai stock market over the past few weeks also reflected her remark. Thai shares yesterday rose 2.8 per cent to a high of 775.41 but weakened slightly to close at 770.61 for a 2.21 per cent gain, with brisk turnover of Bt37.07 billion.

Foreign investors have so far this year bought Thai shares with a net position of Bt82.15 billion.

"The 75 foreign fund managers paid strong attention to the Thai stock market and the most frequently asked questions were about the upcoming general election and the constitution-drafting process. They are all optimistic that Thailand's election will be arranged as soon as possible," Patareeya said after returning from the road show, hosted by Credit Suisse Securities (Thailand).

The SET and 12 listed companies participated in the road show from May 27 to June 3. Of the total 75 fund managers, 31 are based in Singapore, 25 in London and the remainder in New York. They manage assets of more than US$500 billion (B17.3 trillion).

Patareeya said the foreign investors' main concern was the small number of big market cap stocks on the Thai bourse, though the market was attractive for investment.

"In the future, if the SET can successfully approach large companies to list on the Thai stock market, the local stock market would look more appealing to foreign investors," she said.

Regarding privatisation, Patareeya said the SET would pay attention to the issue as both the stock market and the state enterprises would benefit.

"The stock market would grow while those state enterprises would receive fresh funds for business expansion. However, the next government's privatisation policy remains to be seen," she said.

Foreign investors have a bullish view on the Thai stock market as they are confident the country's economy and politics will get back on track since there was no unrest following the Constitution Tribunal's verdict to disband the Thai Rak Thai Party, she said.

Banking, followed by property and energy, were the sectors that received the highest interest among companies attending the road show, she said.

Even though there was more confidence in the country's political future, she warned local investors to snap up stocks with strong fundamentals.

Regarding a rumour that Khunying Jada Wattanasiritham, former president of Siam Commercial Bank, would replace Vijit Supinit, whose chairmanship of the SET ends soon, she said it was too early to speculate on this at moment as the new chair would be selected by the SET's board of governors.

Globlex Securities' vice president for research, Warut Siwasariyanon, said the SET's rise yesterday could be ascribed to the buying spree of foreign investors on the back of the clearer political picture, the country's robust first-quarter economic growth of 4.3 per cent and a new record high on the Dow Jones index.

However, he recommended that investors take profits gradually due to lingering uncertainty about the future of the Thai Rak Thai Party.

An analyst at Siam City Securities echoed Warut's view, saying investors should be prudent on selling and profit-taking until the next election.

The next resistance level of the SET index is 772 while the support level is 755.

 Siriporn Chanjindamanee

The Nation