Data Shows a Gaining Session on Last Trading Day as Economy Expects to Rebound in 2021

As the end of 2020 is drawing near, historical data shows that the Thai stock market always edged up in the last trading day of the year in the last five years even with a slight gain.

 

Looking back at the last trading day for the year in SET Index in the past five years, the market always closed higher. On December 30, 2019, SET Index closed at 1,579.84 points, increased 1.62 points or 0.10% from the previous day.

On December 28, 2018, SET Index closed at 1,563.88 points, increased 15.51 points or 1.0% from the previous day. On December 29, 2017, SET Index closed at 1,753.71 points, increased 10.42 points or 0.59% from the previous trading day.

On December 30, 2016, SET Index closed at 1,542.94 points, increased 5.13 points or 0.33% from the previous trading day. Lastly, on December 30, 2015, SET Index closed at 1,288.02 points, increased 4.24 points or 0.33% from the previous trading day.

In the meantime, when looking back at the global financial crisis in 2008, SET Index also closed the last trading day of the year higher by 3.26 points or 0.7% to 449.96 points.

 

The Monetary Policy Committee (MPC) projected this month that the Thai economy would contract 6.6 percent in 2020, which was better than previously assessed due to improvement in private consumption and merchandise exports. The economy would expand at 3.2 percent and 4.8 percent in 2021 and 2022, respectively.

The committee stated that the economic recovery remained highly uncertain which would in the short term depend on the situation of the new wave of COVID-19 outbreak and corresponding containment measures.

At a longer horizon, it would depend on the recovery in foreign tourist figures, efficacy and coverage of COVID-19 vaccination, and labor market situation in which numbers of unemployed and underemployed workers remained high. Furthermore, uneven recoveries across economic sectors would affect the sustainability of the economic growth going forward.

 

Thailand saw 3,065 foreign tourist arrivals in November, a 155% increase from 1,201 arrivals in October when visitors returned for the first time in six months. Still, the arrivals in November were 99.9% below the 3.39 million visitors recorded during the same month a year earlier.

 

Francisco Blanch, Head of Global Commodities and Derivatives Research at the Bank of America, stated that due to the pandemic, the gap between the U.S. and Chinese economy will draw closer as China has been performing well in controlling the virus outbreak, while the economy is doing well and consumption also edges higher.

As for the oil market, Blanch expected Brent Crude to average at $50 in 2021 as OPEC has been very clear, especially Russia, the group would nott want to lose its market share to the U.S. shale permanently, so they wound not holding back their production forever. Meanwhile, the firm saw an uptick in demand as the new lockdown restricted to certain areas locally, but on a global basis, a rise in consumption has been indicated.

Moreover, Blanch added that the demand for plastic is very strong, thus supporting the petrochemical industry. Lastly, OPEC is expected to move according to plan in rolling back 2 million bpd in August.