Thai Stocks Surge to 14-Year High on Economic Expansion, Reduced Tension

Thailand’s stocks rallied to the highest level in more than 14 years on speculation an expanding economy will boost corporate earnings and elections will ease political conflict.

PTT Exploration & Production Pcl (PTTEP), the nation’s only listed oil explorer, climbed 2.5 percent to 184.5 baht after crude oil rose to a 30-month high in New York. Siam Commercial Bank Pcl (SCB), the nation’s fourth-biggest lender by assets, jumped 4.6 baht after Asia Plus Securities Pcl raised the share-price estimate.

The SET Index climbed 1.6 percent to 1,064.35 at the 4:30 p.m. close, the highest since October 1996. Turnover surged to 48.3 billion baht ($1.6 billion), the highest since Dec. 8, according to Stock Exchange of Thailand data. Shares have gained as concern about political uncertainty eased, bourse President Charamporn Jotikasthira told reporters today.

“Thai companies will continue to have high earnings growth with strong domestic demand,” said Andrew Stotz, a strategist at Kim Eng Securities (Thailand) Pcl, the nation’s largest stock brokerage. “With the election, we can go into a phase of more political stability.”

Thai Prime Minister Abhisit Vejjajiva has said he’ll dissolve Parliament in early May to trigger an election about six months before his term ends. Abhisit pledged policies to help families cope with rising fuel and food costs that threaten to undermine his party’s gains ahead of the elections, according to a March 28 interview with Bloomberg Television.

Overseas Investors

Overseas investors bought 8.28 billion baht more of Thai stocks than they sold today, according to data from the Stock Exchange of Thailand’s website. That was the largest net purchase since Dec. 8.

Bangkok First Investment & Trust Pcl (BFIT) surged 12 percent after Malaysia’s OSK Holdings Bhd. said its investment banking unit agreed to buy a 48.9 percent stake in the Thai company’s brokerage unit.

Stock valuations remain “attractive” because of strong corporate earnings growth, Charamporn said in Bangkok. Shares on the index are valued at an average 12.6 times earnings, the cheapest in Southeast Asia apart from Vietnam, according to data compiled by Bloomberg.

To contact the reporter on this story: Anuchit Nguyen in Bangkok at anguyen@bloomberg.net

To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net

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