SET Index Is Heading to Third Straight Loss, but Historical Data Shows Market Outperforming in Next 30 Days

Thailand’s SET Index has been plunging nonstop ever since the election day on May 14 that saw the left-wing Move Forward Party taking the majority seats, but will require to seek support from other political parties to form a coalition government.

Stock markets hate uncertainties, and that is how the Thai market is right now as investors are waiting to see how the Move Forward Party (MFP) will form its government when the runner-up Pheu Thai Party announced that it will gladly join MFP but under conditions.

SET Index, Thailand’s main bourse, fell for the third straight day on Wednesday morning, coming out of the election on Sunday. The index lost 21.51 points or 1.37% in the first two days and another 1.13% in the morning session on Wednesday, sending the index to move around 1,522.39 points. The market has lost 2.49% in two and a half day after the election.


Tracing back to the previous four elections in Thailand’s history, three out of four times the market rose on the first trading day after the election date. Also, three out of four times that the stock market performs better in the next 30 days, though one that falls out could be arguably due to the month that the global financial crisis started.


2019 Election

The 2019 election that saw the military-backed Pralang Pracharat Party won, led by general Prayut Chan-o-cha, caused the stock market to plunge sharply 1.24% on March 25, the next day of the election date. Still, the market took off the day after and finished 1.64% higher a month after the election.


2014 Election

In February 2014, when the Pheu Thai Party, led by Yingluck Shinawatra, won the election for the second time, the stock market reacted positively on the first day after the election date by 1.45% and plunged on the following day. Still, the index rose 4% in the next 30 days after the election date of that year.


2011 Election

The election in July 2011, Yingluck Shinawatra and the Pheu Thai Party, won with overwhelming votes, sending the stock market to soar as much as 4.7% in the following day and remained relatively higher for the month to follow by around 8.83%.


2007 Election

The stock movement in December 2007 after the general election on 23 December could be ruled out as the financial crisis started in that month. Still, the SET Index rose 3.65% on the first day coming out of the election date when the People’s Power Party won the election, but underperformed in the next 30 days with -6.44%.