Market Roundup 25 September 2023

1) Thai stock market overview

Thailand’s SET Index closed at 1,507.36 points, decreased 15.23 points or 1.00% with a trading value of 42 billion baht. The analyst stated that the Thai stock market edged lower today, following the regional trend over concerns of the Chinese property sector. Meanwhile, the analyst recommended investors to monitor the Congress negotiation for the 2024 budget that could potentially lead to a shutdown if no deals are reached.

The analyst expected SET Index tomorrow to move in a sideways trend as investors will monitor the cabinet meeting for more detail on stimulus measures.


2) Thailand’s central bank to maintain rate in September’s meeting and throughout 2024

The Bank of Thailand is expected to maintain its interest rates at 2.25% in the meeting on Wednesday and likely through 2024, according to the poll made by Reuters.

A year-long tightening cycle by the central bank could come to an end as 21 economists out of 27 expected the Monetary Policy Committee to leave rates unchanged at the meeting this Wednesday despite inflation rising slightly from 0.38% YoY in July to 0.88%YoY in August, it remained well below 1-3% target range of the central bank for the fourth month in a row, which indicated little need for another hike.

Meanwhile, the remaining six economists from the poll expected the Thai central bank to make the final hike in September for another 25 basis points and maintained the rates at 2.5% for the rest of this year.


3) McDonald will raises royalty fees for the first time in 29 years

The iconic McDonald’s Corp (NYSE: MCD) will raise its new restaurants’ royalty fees from 4% to 5% from next year onward, its first hike in three decades. This could affect its relationship with its new US franchisees, buyer of company-owned and the relocated restaurants.

Franchisees run almost 13,400 McDonald’s restaurants or about 95% around the US, as they carry all the costs such as rents, royalty and annual fees for MCD’s own mobile app services. In recent years, there were some issues between McDonald’s and its franchisees, like the new grading system which was disapproved by the workers, and a new California bill that will raise worker wage by 25% next year.