Thai Stock Market Faces Oil Price Surge, Inflation Concerns
Houthi attacks on Saudi oil tankers have pushed crude prices higher, triggering inflation concerns that could weigh on Thailand's stock market this week, though strong domestic investment fundamentals offer some support.
Globlek Securities (GBS) expects Thailand's stock market to decline this week following global trends, with main pressure coming from geopolitical tensions after Yemen-based Houthi groups backed by Iran attacked two Saudi Arabian oil tankers in the Red Sea. The attacks have disrupted energy supply confidence, pushing crude oil prices higher and reviving market concerns about accelerating inflation, leading GBS to forecast the index trading range at 1,600-1,650 points this week. The broader market is supported by strong domestic economic fundamentals, with Thailand's Board of Investment reporting investment promotion applications in the first half of 2025 valued at over 1.47 trillion baht, up 37%, expected to create over 82,000 jobs and generate 1.2 trillion baht in annual export value. Investors should also monitor U.S. trade policy risks, including the Trump administration's tariffs on 60 countries at rates up to 12.5% against Thailand on forced labor allegations, uncertainty over USMCA renewal, rising global interest rates with the Fed expected to hike in September at 83% probability, and the elevated VIX Index at 18.70 reflecting fragile market sentiment. Domestically, watch for Commerce Ministry trade announcements, automotive production data, industrial production indices, Bank of Thailand economic reports on July 31, and the Monetary Policy Committee meeting on August 26; internationally, track the Federal Reserve meeting on July 28-29, U.S. economic data throughout the week, and China's industrial profit reports on July 27. GBS research director Watcharon Jongyariyong recommends investors focus on quality stocks with strong fundamentals while remaining cautious amid external headwinds.
