Industrial stocks depressed the market the most, falling nearly 10 per cent due to an over-13 per cent slide in petrochemical stocks, followed by commercial banks, which fell 8.7 per cent. Technology and construction stocks lost 4 per cent during the previous month.

The SET Index on Friday (January 31) closed at 1,514.14, down 9.85 points or 0.65 per cent over the previous day.

Meanwhile, some stocks defied market sentiment and rose, such as agriculture by over 6 per cent, finance and securities by over 3 per cent, food and beverages by 2 per cent, and property funds by over 1 per cent.

Wijit Arayapisit, a strategist from the research department at Maybank Kim Eng (Thailand), said that the Thai stock market in the previous month was quite different from market expectations in the previous period as the index had dropped almost 100 points after reaching 1,600 points in the first period.

“The most important factor that pressured the market to fall was the outbreak of the coronavirus,” he said.

“Meanwhile, the drought problem which depressed farmers’ incomes, the suspension of the annual budget for fiscal year 2020, and the below-expectation performance of commercial banks due to increasing non-performing loans caused foreign investors to sell their stocks.”

He foresees that the stock market in February will continue to fluctuate because these uncertainties still exist.

“The number of people infected by the coronavirus is continuously rising from 20-30 per cent a day, while the market performance is likely to decrease from Bt103 per share to around Bt99 per share, causing the SET Index value to be tight at this time,” he said.

“Nine statistics in the past 10 years show that Thai stocks in February rose by an average of 2.4 per cent.”

He admitted that Thai stocks this year were pressured by various negative factors which caused foreign investors to sell their stocks.

“We predict that the SET Index will fluctuate between 1,480 to 1,550 points. The important factors that we need to follow are the coronavirus outbreak and uncertainty in the country,” he said.

“In addition, we suggest following the resolution of the Monetary Policy Committee of the Bank of Thailand on February 5, which may cut the interest rate to help debtors pay instalments on time, and the bidding for the 5G broadband network on February 16 on whether there will be new competitors and how intense the competition will be.”

He added that the budget act might support the stock market in the next period if the court issues a verdict and finds a solution as soon as possible.

Meanwhile, Asia Plus Securities predicts that earnings per share growth of listed companies have many negative factors, which may lead to the reduction of net profit forecasts, such as the slowdown of commercial banks, petrochemical, hotel and aviation businesses and the TFRS 16 accounting standard for leases which will affect financial statements and financial structure.

“In addition, some of the real sectors are facing negative impact from a prolonged economic slowdown,” a member of the research team said.

“Therefore, we expect that the net profit this year will be approximately Bt1 trillion, accounting for earnings of Bt95.7 per share. The research team plans to reduce the net profit forecast and earnings per share this year after the announcement of the 2019 financial statement.”