Thailand Business News: Thai Stock Market Outlook for June 20, 2025

Asian markets and currency values experienced a boost as President Trump postponed a verdict on military intervention in Iran. In contrast, Thai stocks suffered a decline last week due to domestic political instability. The SET index concluded at 1,067.63, reflecting a 4.9% decrease from the prior week. While retail investors and brokerage firms showed positive activity, foreign and institutional investors were net sellers. Analysts foresee a further drop in the Stock Exchange of Thailand, potentially dipping below 1,000 points due to ongoing political unrest.

The recent turmoil stems from the potential government collapse of Paetongtarn Shinawatra as the Bhumjaithai Party withdrew from the Pheu Thai-led coalition over a disagreement regarding ministerial positions. Issues such as a leaked video clip featuring Prime Minister Paetongtarn Shinawatra and Hun Sen, and conflicts over the Interior Minister post, have heightened tensions, contributing to the current state of political uncertainty.

Thailand recently awarded its first virtual bank licenses to three alliances led by Charoen Pokphand Group, Gulf Development, and SCB X. These virtual banks are expected to commence operations within a year of receiving regulatory approval. Additionally, the national wage committee has raised the daily minimum wage in Bangkok for unskilled laborers to 400 baht, up from 372 baht, effective July 1.

Further boosting economic activity, the Economic Stimulus Board sanctioned a 110-billion-baht stimulus package. Finance Minister Pichai Chunhavajira estimates that this initiative could elevate the GDP by 0.4% to 0.5%. In the realm of international trade, Thailand observed a significant surge in exports in May, reaching $31 billion, marking an 18.4% increase, linked to companies stockpiling goods amid a temporary reprieve from Trump tariffs.

On the monetary policy front, the US Federal Reserve maintained interest rates at 4.25%-4.50% but projects two rate cuts in 2025. The Bank of Japan retained rates at 0.5% while planning to diminish bond purchases. Furthermore, China experienced accelerated retail sales growth but slowed industrial production, with new home prices in both China and the UK witnessing a decline.

In the domestic market, companies like King Power and Banpu Power made strategic moves. King Power expressed interest in terminating concessions at major Thai airports, while Banpu Power aimed to divest its shares in ten solar power plants in Japan. Analysts from Krungsri Capital Securities advise a diversified investment approach, emphasizing energy, export-related stocks, and domestically-backed equities with robust fundamentals. InnovestX Securities anticipates that the Bank of Thailand will retain its policy rate. Technical analysis forecasts support at 1,030 points and resistance at 1,100 points for the SET.

Despite the recent challenges, the Thai stock market showed some improvement at the end of the week, driven by growing confidence in the country’s economy and its expanding trade relations within the region. The SET Index rose by 0.8% in morning trading, reflecting the highest level in three months. This positive momentum is attributed to enhanced export figures and stabilizing tourism revenue, which are crucial factors influencing Thailand’s economic progress. While this upward trend indicates cautious optimism, investors remain vigilant about global economic shifts and local policy decisions for clearer insights into future market trajectories.