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Thai shares Wednesday gained 1.32 per cent as foreign and local investors flocked into the market on expectation that no political party would be dissolved.

The Stock Exchange of Thailand Index surpassed the 730-points psychological level to end at 737.40 points, or 9.61 points higher, on turnover of Bt19.53 billion.

"Foreigners' net buy totalled Bt933 million yesterday. Most of the buying came in the afternoon as investors had high hope that as Democrat Party was spared from dissolution, Thai Rak Thai Party would be spared too," said Marco Sucharitkul, president of JP Morgan Securities (Thailand).

Investors were also hopeful that after this, all eyes would be refocused on the Charter drafting with expectation that the election would occur on schedule, he said.

Phoning in from Singapore where she took listed companies to a roadshow, SET President Patareeya Benjarongchai said that Democrat Party was spared brought good news as it somewhat cleared political clouds.

"Fund managers here asked me a lot about the judgement and I told them that it should not cast huge impacts on the stock market," she said, adding that foreign fund managers are still interested in Thai stocks, as reflected through the net buy of Bt65 billion from the beginning of this year.

An SCB Securities analyst noted that Thai stocks gained largely from the absence of violence as well as the expectation that both parties would be spared. "Energy and banking stocks were up and (if the verdict on Thai Rak Thai is like that of Democrat), foreigners should buy more into the stocks."

Ahead of the verdict reading by the Constitution Tribunal, Santi Vilassakdanont, chairman of the Federation of Thai Industries, was hopeful that there would be no violence after the verdicts come out.

"Then, after we have the Constitution and the election, the economy in the third and fourth quarter would improve due to regained confidence," Santi said, expecting that the economic growth this year would be 4 per cent.

Siriporn Chanjindamanee

The Nation