Shares of Srisawad Corporation Pcl (SET: SAWAD) tumbled by 7% to THB 26.25, while Muangthai Capital Pcl (SET: MTC) lost 5% to THB 33.25 per share on Thursday.
Analysts have yet to issue comments regarding the steep declines. However, market sentiment appears to have been unsettled by the Bank of Thailand’s (BOT) recent remarks following its decision to lower the policy rate to 1.25% on December 17. Despite a rate cut typically serving as a tailwind for finance firms by reducing borrowing costs, investor attention has shifted to the BOT’s warnings over GDP contraction and a risk of deflation.
Thai equities further tracked broader losses across Asian markets as investors rotate out of technology and growth-oriented stocks amidst rising concerns over elevated valuations. Both SAWAD and MTC experienced notable advances on December 12, prior to the BOT’s rate reduction, amid expectations of selective buying tied to the dissolution of parliament and anticipated campaigns around title loans in Thailand.
Additionally, trading activity is projected to remain subdued throughout the remainder of December, potentially resulting in higher volatility given the lighter volumes.
