Market Update 27/09
Thai Market has been holding up well, even as the currency has been rather decimated this year…surprised? Nope….public co’s here are making $ hand over fist, same story, market share goes to the big boys and they’re all listed. Though I am wondering if we may finally see a sell-off this week…when will the insurance co’s finally run? TLI looks like it’s making moves…
Xavi
Just reading up that the first lot of tariff adders from the early 2010s are set to expire soon…Will have a major effect of listed and unlisted companies like Gunkul, BCPG, WEH etc, although haven’t dug into the numbers..
Pon
SPCG should be the worst hit…though they have recently won some new projects.
peter satrapa-binder
I also guess that the selloff has started in some fashion 1-2 days ago and will continue for some time to come.
Pon
ha, its been amusing. pain is in the currency more than the market. Have said that for a while, though the THB hitting 38 has been a surprise mainly because i, perhaps, foolishly thought the BOT would be more aggressive with rate hikes (had several debates with some people there and friends who are far more intelligent than me), because that’s what I WANT TO SEE, so my bias got in the way…
peter satrapa-binder
well, many have been moaning that the baht had been too high when it was at the 33 – 34 level to the USD and it’s good for inbound tourism and exports.
i also believe that central banks have to be careful when upping the interest rates for fighting inflation, as unless many times before the current inflation wave has not been driven by overheating economies, but by problems on the supply side (energy, etc.), so this time the old and tried remedy of increasing interest rates might not work as well as it had several times in the past.
i think the US Fed has been a little bit too zealous in increasing their interest rate and there is a real danger than this will finally tip the USA into a recession.
so, maybe it’s not that bad that the BOT is rather staying on the cautious side.
Pon
Higher interest rates are better for the real economy.
I’m very happy to see this. When there is a cost to money again, real business happens.
The BOT will turn thailand into japan if they go down this route. And that’s awful for the domestic econ.
I want to see rates go up globally, pain for a few years – maybe another war elsewhere – and then a beautiful renaissance.
peter satrapa-binder
ok, agreed, but jacking them up too fast too high can be risky for the economy. so, i think doing it slower like the europeans do or like thailand does is probably better in the short term (better to do many small gradual hikes of only 25 – 50 basis points each than just 3-4 hikes of 75 or 100 basis points, as i think that currently the economy is not strong enough to weather the shock of very fast, very strong rising interest rates.)
regarding another war elsewhere: i do hope that wouldn’t be china trying to take over taiwan.
Pon
A fast rate hike is fantastic, the problem is only that they are doing it 6 months too late.
They already own Taiwan economically. No war in the near term (within 5 years), will easily bet on this, actually even longer term, don’t see them doing it…
peter satrapa-binder
regarding china/taiwan, well, a war would be a lose/lose situation for everybody, so, if china remains rational they wouldn’t do it. but, as for politicians ‘remaining rational’, well, see russia’s invasion of ukraine…