Bangkok: Thai stocks rose this morning as the market eased concerns about the trade war. Analysts believe that even though the IMF lowered its forecast for Thailand's GDP in 2025, it is still higher than analysts' estimates. Thailand, meanwhile, will not be affected much by the tax on solar panels.
According to Thai News Agency, reporters observed that Thai stocks opened positively this morning, aligning with the broader Asian market trends. At 11:32 am, the index climbed to 1,158 points, marking an increase of 14.72 points or 1.29% from the previous day. Mr. Korapat Vorachet, Assistant Managing Director, Head of Research at Krungsri Securities, attributed the rise in Thai stocks to a relaxed stance from the United States towards China. Both the US Treasury Secretary and President Donald Trump have indicated that the trade conflict with China is 'likely to ease,' alleviating market concerns and supporting a recovery in US and Asian stock indices.
Regarding trade negotiations with the United States, it is anticipated that the Thai government will pursue a balanced and neutral policy towards both the US and China to mitigate pressure from both nations. The US recently announced a tax increase on Thai solar panels of up to 375%, which is believed to benefit Thailand in the medium to long term. Thai companies are expected to remain largely unaffected, as the move may encourage foreign investment to focus on local production within Thailand rather than merely rebranding goods from China. This shift is expected to enhance Thailand's economic image in terms of production and exports.
The International Monetary Fund (IMF) has recently revised down its global GDP growth forecast to 2.8%, primarily due to a downward revision of US GDP growth to 1.8% this year and 1.7% in 2026. This reflects a soft landing for the US economy. For ASEAN, the forecast was revised down by 0.6%, with Thailand projected to grow by only 1.8%, the lowest in the region, due to the impact of an earthquake and trade tariffs.
Despite the IMF's downward revision of Thailand's GDP, confidence in the Thai stock market remains unaffected, as local economists had already anticipated a lower GDP growth of around 1.5%. This expectation has allowed the stock market to absorb the negative outlook. The outcome will depend on the Thai government's ability to negotiate a tax reduction with the US, which could yield positive results if discussions open within 90 days, potentially lowering the overall tax rate. Consequently, the Thai stock market has continued to recover within a resistance range of 1,167 points and a support level of 1,137 points.
Mr. Korapat noted, "Although the IMF has revised down its global and Thai GDP forecasts, the figures are still 'better than expected', which will support the Thai market to recover from the Deep Value Zone, especially when capital flows start to return somewhat. Under the recovery base that still has buying power from the Underowned and Domestic-led plays groups, the market is also anticipating the US Flash PMI results tonight, which will reflect the effects of the Trade Tariff for the first time. If it is lower than 50 points, it will support a decrease in the US Bond Yield. We should keep an eye on the resistance level of 1,167 points. If it passes, it will start to make the medium-term picture slightly positive, with a chance to test 1,200 points."