Shares rally another 3.3% on recovery hopes

The SET Index moved in negative territory in the first hour of trading, but profittaking later succumbed to the inflow of capital and it closed at the day's high of 523.14 - a 16.88point gain. Turnover was heavy at Bt30.86 billion.

Large marketcap stocks were still at the centre of the rally, led by energy shares. PTT jumped 6.27 per cent to Bt212, PTT Exploration and Production rose 1.83 per cent to Bt111 and PTT Aromatics and Refining advanced 6.8 per cent to Bt15.70.

Thai Oil surged 5.3 per cent at Bt34.75, IRPC shot up 6.25 per cent to Bt3.06 and Thoresen Thai Agencies increased almost 5 per cent to Bt19.

An analyst at Sicco Securities said the euphoria was in line with other Asian stock markets, and was propelled by an inflow of foreign funds after the baht appreciated against the US dollar.

US Federal Reserve Chairman Ben Bernanke's most recent speech, in which he said the threeyear fall in the US property market might have almost reached the bottom and the US economic recession would end by the end of the year, had a positive effect on Asian stock markets, the analyst said.

However, investors should keep a close eye on the stresstest results on US banks, to be offi¬cially announced today. It is esti¬mated that 10 of the 19 largest banks in the US will be in need of recapitalisation.

Decha Khumpang, BFIT Securities' managing director, said the Thai stock market's sen¬timent this quarter would improve following clear signs of economic recovery.

"The stock market will improve in the second quarter after some economic indicators show signs of recovery and Bernanke's remark that the eco¬nomic slowdown is reaching the bottom. The higher trading vol¬ume will offset the thin trading volume in the first quarter," he said.

He forecast that daily trading volume this year would average Bt15 billion, lower than last year.

The SET Index will hover at around 550600 points this year, Decha predicted.

Kuntra Ladavalya Na Ayudhya, senior executive vice president of Syrus Securities, said his company had main¬tained its SET Index target at 520 points this year, based on an assumption that the world econ¬omy will recover.

The increase in average daily trading volume in the second quarter will come as a boon to the brokerage industry, he said.

Kuntra forecast that daily trading volume would average Bt16 billion this year.