PM blames court cases for SET slip
Says investors fearful of political ramifications
Prime Minister Srettha Thavisin yesterday admitted that the current political situation could impact the stock market, which hit a four-year low on Monday.
His remarks came after Thai stocks plunged amid growing concern over three major court cases that could have ramifications for the Thai political landscape.
When asked to comment about the stock market slump before yesterday’s cabinet meeting, Mr Srettha said financial institutions may have been reacting to three major court cases.
“It is about stock market sentiment,” he said, adding that those accused in the three cases, including himself, have to defend themselves in court.
Last Friday, Mr Srettha submitted his defence to the Constitutional Court in a case involving the controversial appointment of politician Pichit Chuenban as a PM’s Office minister.
Previously, 40 caretaker senators asked the court if both should be removed from office under Section 170 (4) and (5) of the charter, which deals with the ethics of cabinet ministers.
The appointment of Pichit, who once served as former prime minister Thaksin Shinawatra’s lawyer as well as Mr Srettha’s adviser, as PM’s Office minister proved controversial.
This is because he served jail time for contempt of court in connection with an attempted bribery case when he represented Thaksin in a land deal case in 2008.
The Constitutional Court is also scheduled to consider a dissolution case brought against the Move Forward Party today.
Former premier Thaksin Shinawatra is scheduled to report to the attorney general on June 18 so that an indictment process can begin.
On May 29, the attorney general decided to indict Thaksin on lese majeste and computer crime charges arising from an interview given to a newspaper in Seoul on Feb 21, 2015.
On Monday, Thai stocks plunged to a four-year low as investors fretted over political uncertainties.
The Stock Exchange of Thailand (SET) Index fell to a low of 1,313.26 points around the close of the morning session at midday, the lowest level since March 23, 2020, as internal politics weighed heavily on investor confidence.
InnovestX Securities said the SET Index is expected to be volatile this month after the Constitutional Court accepted a petition filed against Mr Srettha by the 40 outgoing senators.
According to Sittichai Duangrattanachaya, a senior global equity strategist at the firm: “Fund outflows will remain a major risk factor for the second half of this year as politics could delay or affect the implementation of government policies to jump-start the economy,” he said.
An analyst from Finansia Syrus, who spoke on condition of anonymity, said: “The most important case, in our view, is the ruling on the status of Mr Settha. This is a risk factor for the government’s stability.’’
Sanan Angubolkul, chairman of the Thai Chamber of Commerce, said the stock market slump was caused by several factors, including the political situation, a slow economic recovery, and high levels of household debt.
These prompted investors to lose confidence and sell Thai stocks, he said.