Market Roundup 4 September 2023

1) Thai stock market overview

Thailand’s SET Index closed at 1,548.68 points, decreased 12.83 points or 0.82% with a trading value of 50 billion baht. The analyst stated that the Thai stock moved in an opposite direction of regional markets as energy stocks continued to be sold off in concerns of the government’s new measures to reduce gas and electricity prices. Thai Oil Pcl. fell more than 5% due to the report of oil leakage in the ocean.

The analyst expected the Thai stock market would continue to trend downward tomorrow and advised investors to monitor Thai inflation data.


2) US Fed is done raising interest rates

The market is now almost certain that the U.S. Federal Reserve will not raise interest rates in September, while two other meetings in November and December also have more than 50% probability that the central bank will maintain the rate at 5.25-5.50%.

The odds for the U.S. central bank raising interest rates in September jumped from 80% a week ago to 93% last Friday after the statistics bureau reported rising unemployment rate in the world’s largest economy.

The Bank of America wrote in its note that job openings and unemployed peaking are a strong sign that the Fed is done.

The odds for the Fed to maintain rates at the current level in November rose to 63.5% from 44.5% a week before. The probability at the December’s meeting also has similar data.

Meanwhile, the market gives the best odds for an interest rate cut to begin in May 2024 with a 37.5% chance that rose from 30% a week prior.


3) EU concerns of double crisis from Russia-Ukraine war and recession

Mr. Paolo Gentiloni, the EU economics chief, through an interview with CNBC stated his concern on the EU double crisis; the Russia-Ukraine war and the EU economic recession, which has the most impact on Germany.

According to the IMF, the eurozone economy or Real GDP grew by 3.5% in 2022 which is more than the US and China, but it is expected at 0.8% in 2023 and 1.4% for 2024, which is a very low rate.

The European Union had strong rebound after the pandemic, but growth started to slow down since Q4 last year due to energy independence from Russia. Still, Paolo said that the recession is avoidable.