Positive Sentiment in Leasing Stocks Derailed by Fed’s Comment on Rate Hikes

Thailand’s cabinet on Tuesday approved a law to allow the central bank to regulate the leasing business of cars and motorcycles to strengthen consumer protection and tackle household debt.

According to the announcement from the Finance Ministry, the law will ensure consumers are treated more fairly. The finance ministry noted that transactions in the auto leasing sector accounted for 12.4% of total household debt in Thailand, and were on an upward trend.

The cabinet will also let the Thai central bank extend its soft loan program for smaller firms until April 2024.

This measure will support business operators in receiving funds with appropriate interest rates as the country is going through an economic recovery.


Asia Plus Securities (ASPS) wrote in a note, expecting leasing stocks such as Srisawad Corporation Public Company Limited (SET: SAWAD), Heng Leasing and Capital Public Company Limited (SET: HENG), Saksiam Leasing Public Company Limited (SET: SAK), Nergn Tid Lor Public Company Limited (SET: TIDLOR) and Thitikorn Public Company Limited (SET: TK) to benefit from the measure.

The majority of these stocks recognized positive sentiment from the measure yesterday with SAWAD (+2.87%), HENG (+2.82%), SAK (+3.94%), TIDLOR (0.00%) and TK (+2.50%).


However, the momentum that was previously believed to carry over to today’s session got derailed by the U.S. Federal Reserve’s statement on policy rates yesterday that dragged whole markets down.

The Dow Jones Industrial Average closed 575 points or 1.7%, lower at 32,856.46 points. The S&P 500 was down 1.5% and the Nasdaq Composite fell 1.3%.

At the closing of the morning session on Wednesday, Thailand’s SET Index fell 8.26 points or 0.51% to 1,610.25 points, erasing some losses in the early morning that resulted in the market dropping more than 1%.

Leasing stocks that were projected to extend their gains were mostly down this morning with SAWAD (-2.33%), HENG (-0.68%), SAK (-0.76%), TIDLOR (-1.22%) while TK was the only stock that ended higher at +0.26%.