SET dives as baht weakens
http://www.bangkokpost.com/news/loca...s-baht-weakens
SET dives as baht weakens
- Published: 10/01/2011 at 04:59 PM
- Online news: Economics
The Thai stock market plunged by more than 20 points, or two per cent, on Monday afternoon following a continuous sell-off by foreign investors, as the baht weakened to 30.70/75 baht per US dollar, the lowest in five months.
Stock analysts said foreign investors had started taking out their profits in face of the baht's depreciation.
The Stock Exchange of Thailand (SET) composite index closed at 1,018.03 points, down 18.42 points or 1.78 per cent, on today's trading session. The trade value was 46.11 billion baht.
Soybean and Rice Bran Oil Processors Association chairman Vichit Vitayatanagorn said bottles of soybean cooking oil are rapidly disappearing from retailers' shelves after the government approved an increase in the price of palm cooking oil from 38 to 47 baht for a one litre bottle last week.
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"Some department stores don't limit purchases, allowing customers to hoard cooking oil products," Mr Vichit said.
"However, production capacity remains the same, and the quantity of cooking oil products delivered to department stores has not changed."
He said 70 per cent of consumers buy palm cooking oil and about 28 per cent buy soybean oil.
The number of people buying soybean oil would increase if the price of palm oil is higher than soybean oil, he said.
Internal Trade Department director-general Vatcharee Vimuktayon said the government will not intervene and will allow the market mechanism to run its course.
Mrs Vatcharee said if people believe products were being hoarded or sold at unrealistic prices they can report it to her department on the 1569 hotline.
Real Estate Information Centre director-general Samma Kitsin said the real estate sector is hopeful the domestic market will be on the upswing in the first half of this year, but is concerned that the price of construction materials will increase.
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Mr Samma said the confidence index of business operators towards the overall economy and the real estate market for the first six months of 2011 rose to 68.7 per cent. The index previously stood at 65.6 per cent.
The confidence index of real estate firms listed in the stock market stood at 74.7 per cent, higher than other unlisted companies at 62.7 per cent.
"Most businesses don't expect any major political events or violence like last year, but they are worried about the likely increase in the price of construction materials because the wholesale price index in this area in 2010 rose two per cent year-on-year," he said.
The price of steel, wood, electrical and plumbing equipment and other construction items had gone up last year.
He said the retail price of cement dropped eight per cent in 2010, but would likely increase later this year.
