Latest Market Update : Impact on Investments Due to the Thai Prime Minister’s Removal

• The Constitutional Court's ruling on the tenure of Prime Minister Srettha.
  
• The ruling's impact on the economy.
  
• Investment perspectives and recommendations.
  

• The Constitutional Court ruled in a 5:4 decision that Prime Minister Srettha Thavisin is disqualified on grounds of integrity due to the appointment of Pichit Chuenban. As a result, the tenure of Prime Minister Srettha Thavisin and his Cabinet has ended.

• This ruling was unexpected by the market. The next steps will involve the process of selecting a new Prime Minister and Cabinet. The 2024 fiscal budget may be delayed by 2-3 months from the original timeline, and various economic stimulus measures may also be altered. However, we anticipate that the budget will be allocated to drive the economy in other areas. The Thai stock market experienced a slight decline of approximately -0.61% over the two days from 14-15 August.

Investment perspectives and recommendations

We expect political factors to continue pressuring the Thai stock market in the short term until there is clarity on the new government and subsequent policies. If a new Prime Minister is selected quickly, the impact on GDP is expected to be minimal, with limited downside risk for investments. There remains potential for market upside as policy directions are unlikely to change significantly. However, if the formation of the government is delayed, it could negatively impact both the economy and foreign investor confidence, potentially leading to a market downturn. Nevertheless, long-term investors should remain calm and continue investing according to their portfolio’s risk tolerance. Diversifying investments across various assets, as suggested above, can reduce the risk of losses and emphasize the importance of maintaining a balanced portfolio during periods of market volatility.

Warning : Investors should understand the characteristics of the product, return conditions, and risks before making an investment decision. Past performance is not a guarantee of future results. Investors should study the information about the mutual fund, especially the investment policy, risks, and performance disclosed in various sources or consult an investment advisor before deciding to invest. Additionally, investors should review the tax benefits specified in the mutual fund investment guide. This document is created for general dissemination and is based on sources considered reliable as of the date the information is presented, but the accuracy of the information cannot be fully guaranteed. Such information may change without prior notice. The investment proportions and performance data presented are for the initial portfolio, and the actual investment proportions and performance of individual investors may vary depending on the investment period and various costs as specified in the policy. For more details, please call 1766.