thailandedition
Govt Formation Speed Watched; Delays a Concern

Govt Formation Speed Watched; Delays a Concern

MGR Online•Economy•1d ago

Reader Briefing

Thai stock market shows positive sentiment post-election, driven by foreign investment and political clarity, though concerns over government formation speed and structural issues remain.

  • •Foreign investors are showing increased confidence in Thailand's political stability and economic outlook following the election.
  • •The Thai stock market (SET Index) experienced a significant rally, driven by fund inflows and anticipation of government led economic stimulus.
  • •Analysts are closely watching the speed of government formation, with delays potentially becoming a downward pressure on the index.

Overview

  • •In the second week of February 2026, the Thai stock market (SET Index) showed significant recovery.
  • •Foreign investors believe a clear government will bring back investor confidence and capital inflows.
  • •Foreign investors bought net over 40,000 million baht in the past 4 business days.
  • •The Baht has strengthened, breaking the 31 baht per US dollar level, the strongest in 2 weeks.
  • •Analysts from global institutions like Bloomberg and Morningstar view Thai equities as offering attractive valuations and value stocks.
  • •Analysts are cautioning about an 'overbought' condition in the technical sense, which could lead to a pullback.
  • •Delays in government formation could become a pressure factor, potentially pushing the index below 1,350 points.
  • •The new government's speed in implementing economic measures will be a key factor for the index's future movement.

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Key Quotes

Kaohoon Securities Analyst
"In the case of a delayed government formation (over 3 months), if political vacuum occurs, the index target will be immediately cut to only 1,350 points."
กรณีจัดตั้งรัฐบาลล่าช้า (เกิน 3 เดือนขึ้นไป) หากเกิดภาวะสูญญากาศทางการเมือง เป้าหมายดัชนีจะถูกหั่นลงเหลือเพียง 1,350 จุด ทันที
Chawinda Harnrattanagul, MD of Krungthai Asset Management
"The challenge from here on is the 'speed' of the new government in implementing economic measures, which, if done quickly, will be a driving force for the index to move forward."
ความท้าทายหลังจากนี้คือ “ความเร็ว” ของรัฐบาลใหม่ในการออกมาตรการเศรษฐกิจ ซึ่งหากทำได้รวดเร็ว จะเป็นแรงส่งให้ดัชนีมีโอกาสไปต่อ

Key Entities

Policy

Fund Flow
Refers to the movement of investment capital into and out of a country's financial markets, significantly influencing the Thai stock market.
Mega Projects(เมกะโปรเจกต์)
Large-scale infrastructure projects expected to receive a boost from the new government, influencing investment decisions.
CPIℹ️
Consumer Price Index, a US economic indicator whose announcement will affect the direction of the dollar and emerging market fund flows.

Place

United States(US)ℹ️
The origin of concerns regarding economic recovery and tariff policies affecting global markets, and a key investor base for Thailand.
EECℹ️
Eastern Economic Corridor, an area targeted for investment, particularly for Data Centers, which is expected to be supported by government policy.

Organization

KBANKℹ️
Kasikornbank, a banking stock expected to move actively due to the recovery in domestic consumption and stable interest rates.
BBLℹ️
Bangkok Bank, a banking stock expected to move actively due to the recovery in domestic consumption and stable interest rates.
Bloombergℹ️
A global news and financial information provider whose analyses suggest the Thai stock market is moving past a long period of uncertainty.
Morningstarℹ️
A global investment research firm whose analysis indicates the SET index rally reflects confidence that clearer political views will attract foreign capital.
Dow Jonesℹ️
A financial news and data provider, referenced for its role in conveying the analyses of Morningstar regarding the Thai stock market.
Capital Economicsℹ️
An economic research firm that believes if the new government can achieve political stability, it will be a significant positive factor for foreign investors.
J.P. Morganℹ️
A global financial services firm presenting a cautiously optimistic view on the Thai market, highlighting structural issues as the next challenge.
UBSℹ️
A Swiss global financial services company whose analysts are signaling that Thailand may be emerging from a period of political 'vacuum'.
Amundiℹ️
A large European asset manager reporting that Thailand may be exiting its political vacuum, viewing the formation of a strong majority government positively.
Tisco Securities
A Thai securities company collaborating with international research networks, noting foreign investors increasingly view Thailand as a Safe Haven in emerging markets.
WHA
WHA Corporation, an industrial estate developer whose stocks are a focus for European investors due to the trend of reshoring and manufacturing base relocation.
AMATA
Amata Corporation, an industrial estate developer whose stocks are a focus for European investors due to the trend of reshoring and manufacturing base relocation.
S&P Globalℹ️
A global information and analytics company that maintains Thailand's credit rating at Stable (BBB+), warning about household debt and aging society as long-term headwinds.
DBS Group Research
A research arm of DBS Bank that highlights Thailand's reduced risk profile due to the swift formation of a government, anticipating smoother budget disbursement.
Nomuraℹ️
A Japanese financial services group emphasizing Thailand's role in the 'China Plus One' strategy, with industrial estates and logistics becoming targets for Japanese capital.
HSBCℹ️
A British multinational banking and financial services organization that offers a more cautious outlook, suggesting Thai stocks may underperform larger markets.
Krungthai Asset Management Public Company Limited(บริษัทหลักทรัพย์จัดการกองทุน กรุงไทย จำกัด)
A Thai asset management company and president of the Association of Investment Management Companies (AIMC), expecting 2026 to be a better year than the previous one.
TISCO Asset Management(บริษัทหลักทรัพย์จัดการกองทุน ทิสโก้)
A Thai asset management company advising selective stock picking with a focus on high dividend yield stocks, particularly in infrastructure and technology.
Kaohoon Securities(บริษัท คิงส์เบอร์รี่ ดิเวลลอปเมนท์ จำกัด)
A Thai securities company that released its February 2025 strategy report, highlighting 'Expectation over Election' and three positive factors supporting the index.
Bualuang Securities(บริษัทหลักทรัพย์ บัวหลวง จำกัด)
A Thai securities company focusing on the 'Timing' of government formation, outlining index targets based on formation speed and recommending selective buys.
Bhumjaithai Party(ภูมิใจไทย)ℹ️
The leading party in the government coalition, recognized for securing a strong majority and expected to drive policy continuity and infrastructure projects.

Stat

GDPℹ️
Gross Domestic Product, Thailand's economic indicator whose announcement will be monitored to confirm the strength of the economy supporting stock index growth.

Person

Trumpℹ️
Former US President whose import tax policies are cited as an external risk factor that could impact supply chains in ASEAN.