Thai stocks took a nosedive on Wednesday, the biggest drop among the benchmark gauges in Asia.
A woman stands in front of an electronic stock board in Bangkok on Feb 19, 2013. (Bloomberg Photo)
The Stock Exchange of Thailand Index rose 24.58 points, or 1.57%, to close at 1,543.67 at the end of trading. Turnover was 83.65 billion baht, with 31.70 billion shares traded.
Kasikornbank Plc (KBANK) lost 4.2% in Bangkok amid concern valuations in the country's benchmark stocks are too expensive. Kasikornbank, Thailand's fourth-largest listed lender by assets, fell the most since June 1.
The SET50 index of blue chips ended at 1,016.01, down 13.43 points, with total trade value of 41.96 billion baht. The SETHD index of high-dividend shares plunged 23.76 points to 1,265.11, with turnover of 15.90 billion baht. The Market for Alternative Investment lost 15.07 points to 476.59, with transaction value of 6.13 billion baht.
Overseas investors sold a net US$88 million of Thai shares during the past two days, according to data compiled by Bloomberg.
As for the continuing strengthening of the baht, Finance Minister Kittiratt Na-Ranong said the meeting of economic ministers on Wednesday agreed it is not necessary to use special measures to curb the currency because it would have a negative impact in the long-term.
"We have no thought of using unnatural strategies to prevent the baht from getting stronger, just the normal measures such as fiscal measures, investment planning and the interest direction policy of the monetary policy committee," said Mr Kittiratt, also deputy prime minister for economic matters.
He made it clear that any change in the key interest rate is a matter for the Bank of Thailand's Monetary Policy Committee and that no one could interfere with it.
The meeting also agreed that the overall economy has been growing well, and that government revenue from tax collection was in line with earlier projections, he said.
Central bank governor Prasarn Trairatvorakul said the BoT has no grave concerns about the quick appreciation of the baht over the past two days.
The currency rose on investors' perceptions of its value against major currencies, in a comparison with other regional currencies, he said.
"The baht appreciated too quickly over these two days, but the baht's strengthening is not the result of unusual foreign capital inflow. It reflects its value," Mr Prasarn said.
Mr Prasarn said the majority of foreign capital inflow was in long term bonds.
He declined to answer when asked if the BoT would introduce special measures to rein in the baht's exchange rate.
The baht's strength basically reflects investors' good feelings about the Thai economy, he added.
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Article source: http://www.thethailandlinks.com/2013/03/20/thai-stocks-slump-baht-still-strong/
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