The Thai stock market closed at 1,296.37 points on Tuesday, representing a gain of 13.17 points or 1.03%, with a total trading value of 52.63 billion baht. Foreign investors registered net purchases for the fifth consecutive session, with net inflows of 3.66 billion baht, totaling more than 13.09 billion baht in net buying over the last five days.
Krungsri Securities (KSS) sees continued interest from international funds in Thai equities, attributing the trend largely to external factors. Easing tensions in U.S. trade policy, as well as President Donald Trump’s approach toward the European Union, have boosted capital flows into Asian markets, including Thailand.
According to Krungsri, global investors are redirecting capital into emerging markets amid geopolitical uncertainties elsewhere, with Thailand’s equity index considered undervalued and appealing for fresh investment.
Market participants are also monitoring the formation of a new government. Expectations for a stable administration are viewed as a potential catalyst for further gains in Thai equities, with the resistance level seen near 1,325 in the short term.
Asia Plus Securities noted that the sustained foreign buying is primarily driven by external conditions, prompting increased capital flows into Asia and especially into Thailand. The market environment is becoming more favorable for equity investment as the size of the local bond market now stands at approximately 17.9 trillion baht, surpassing the stock market’s valuation of about 16.1 trillion baht.
Meanwhile, the yield on 10-year Thai government bonds has climbed 0.18% since the start of 2026, and the current yield curve suggests a bear steepening pattern. This reflects renewed concerns that inflationary pressures could resurface while the policy rate remains low, encouraging reallocations from safer assets to higher-risk investments.
The dividend yield gap in Thai equities, currently at around 3%, mirrors previous periods when foreign capital made significant returns to the local stock market, notably in 2016 and 2022. Asia Plus forecasts that the trend may continue in 2026, with more capital moving out of bonds and into domestic stocks.
Last year, foreign investors recorded a net sell-off of over 107 billion baht in Thai stocks and shifted roughly 72 billion baht into local bonds, influenced by several factors including expectations of four rate cuts by the Bank of Thailand to as low as 1.25%, nine consecutive months of negative inflation averaging -1.4%, and heightened domestic uncertainties such as earthquakes, flooding, political instability, and interruptions to fiscal policy.
In light of the anticipated return of foreign fund flows to Thai equities, the analyst recommends investors gradually accumulate large-cap stocks such as PTT, PTTEP, DELTA, IVL, and BDMS.
Over the past four trading sessions (January 14-16, 19, 2026), the ten most favored stocks among foreign investors were: PTTEP (979.34 million baht net bought, average price 115.54 baht); CPALL (906.92 million, 42.93 baht); PTT (813.04 million, 32.93 baht); MINT (570.62 million, 22.15 baht); DELTA (497.45 million, 163.81 baht); BBL (457.74 million, 170.67 baht); SCB (408.44 million, 138.98 baht); KTC (407.45 million, 27.04 baht); SCGP (351.58 million, 20.38 baht); and KTB (300.59 million, 28.67 baht).
According to Trinity Securities, the return of foreign capital flows is expected to accelerate following the election period, especially if a new government can form within 60 days and drive economic recovery.
The brokerage firm projects foreign inflows into Thai equities to reach around 150 billion baht this year, after roughly 450 billion baht in net outflows over the previous three years. In the past two months alone, foreign investors have become net buyers with more than 8.8 billion baht in purchases.
Looking ahead, the Thai stock index is forecast to reach 1,406 points in 2026, based on an estimated earnings per share (EPS) of 97 baht and a forward P/E of 14.5x. Further upside could be supported by positive profit momentum.
Thai equities remain attractive to investors seeking dividends, with 30 companies in the SET100 offering yields above 5%. The earning yield gap stands at a robust 5.9%, and the current yield curve supports expectations for a gradual recovery over the next 6 to 12 months. Non-performing loans are expected to remain manageable, and the balance of payments is seen as stable.
