SET president Pakorn Peetathawatchai said the index had plunged by 135.02 points (10.8 per cent) by 3.30pm to 1,114.87 points as investors fretted about the damage the Covid-19 virus is doing to business worldwide.

He also cited tough competition and technological changes in the securities industry as challenges facing entrepreneurs.

“We have spoken with government authorities about using the Thai Opportunity Fund to help stabilise the stock market, and that is under consideration,” he said.

The SET has in the meantime issued measures to help reduce expenses and operating costs and increase liquidity for businesses:

• a 20-per-cent cut in the annual fee charged to listed companies, securities companies and asset-management companies using the Thailand Securities Depository (TSD) as registrar

• a lower annual fee for listed companies participating in “Opportunity Day” this year and next, a move aimed at encouraging them to be transparent in sharing information with investors

• lower fees associated with TFEX transactions and for registering derivative warrants, and use of technology enabling free services for individual investors

• a 20-per-cent cut in security maintenance fees from April 1 to December 31 to reduce expenses for TSD members such as securities companies and custodian banks

Pakorn said the SET was ready to assist entrepreneurs, who he said play an important role in driving the economy.

“These measures cover more than 800 firms, including limited companies, securities companies, asset management companies, and custodian banks,” he said.

“The SET will monitor the situation closely and is ready to support the capital-market sector in all dimensions, as well as coordinating with the government in its policy to help entrepreneurs overcome this situation.”

A gold bar was Bt24,350 to buy and Bt24,450 to sell, while gold ornaments were Bt23,907.32 to buy and Bt24,950 to sell.

At Wednesday’s close, a gold bar was Bt24,600 to buy and Bt24,700 to sell, and gold ornaments Bt24,149.88 to buy and Bt25,200 to sell.

Gold contracts in COMEX futures to be delivered next month decreased by US$18 to $1,642.30 per ounce at Wednesday’s close after US President Donald Trump and Senate leaders from his own Republican Party failed to agree on economic stimulus measures to mitigate the impact of the Covid-19 outbreak.

Trump offered to cut the payroll tax to zero until the end of the year, but party stalwarts believe the move would leave the government unable to support citizens’ health insurance and social welfare.

The White House is meanwhile considering aid for the US oil industry, which has been affected by the decline in oil prices stemming from a conflict between Saudi Arabia and Russia.

The Stock Exchange of Thailand (SET) index lost 109.84 points compared to Wednesday’s closing figure, a 8.79-per-cent drop to 1,140.05 points.

An analyst at Krungsri Securities said he expected the SET to fall 1,220-1,235 points due to the uncertainty over the Covid-19 outbreak and heavy pressure to sell off oil stocks.

“Oil prices fell sharply last night because of the Covid-19 outbreak,” he said, referring to Wednesday’s downturn.

“Meanwhile, the World Health Organisation has now declared Covid-19 a pandemic and the number of confirmed infections in Thailand has risen again, putting more pressure on the market.

“Plus, large-cap stocks are still under pressure due to foreign investors continuously selling their stocks.”

The analyst recommended buying power plant stocks, focusing those with high earnings per share and high dividend yield. The price of those stocks, such as BCPG and GPSC, has declined since the government capped electricity bills.

The analyst also recommends:

● Retail stocks, such as CPALL, HMPRO and BJC, which gained buying power after the government returned Bt30 billion in electrical-meter insurance revenue

● Financial stocks, such as MTC, SAWAD and KTC, which have benefited from interest rate cuts

● Defensive stocks, such as ADVANC, INTUCH and TTW, which pay high dividends.

The latest bout of virus-fomented turmoil tipped Dow Jones Industrial Average into a bear market, ending the longest bull run in the history of American equities. The blue-chip slumped 5.9% Wednesday and ended 20% below its February closing record. The S&P 500 dipped into bear territory before closing 19% below its high.

The WHO declaration rattled already on edge that the spreading virus will upend global growth. President Donald Trump didn’t keep his promise to detail stimulus plans, and late Wednesday said he the U.S. may not need to take those measures “if we get rid of the problem very quickly.” He plans to make a statement at 8 p.m. in Washington. European officials signaled a growing willingness to move soon to combat the virus’s effects on the region’s economy.

Signs that companies in the hardest-hit industries were drawing down credit lines to battle the effects of the virus on their businesses added to anxiety. The New York Stock Exchange said it will restrict access to its trading floor, the Wall Street Journal reported.

“We have no idea when the coronavirus, the spread, is going to subside. That uncertainty is going to continue to create a lot of volatility,” said David Spika, the president of GuideStone Capital Management. “We have no idea how to model it, we have no idea what to expect from it.”

Here are the main moves in global markets:

– Private equity titan Blackstone Group Inc. asked companies it controls to draw down their bank credit lines to help prevent any liquidity shortfalls.

– All but 10 stocks in the S&P 500 retreated Wednesday, with every industry down at least 3.9%.

– Boeing plunged 18% after it said it plans to draw down all of a $13.8 billion loan. Hilton Worldwide lost 9% when it said it would draw some of its credit line.

– An index of consumer services providers that includes hotels, cruise operators, Starbucks and Chipotle plunged 8.3%.

– European equities wiped out a 2.3% advance sparked by an emergency rate cut in the U.K.

– Municipal bonds tumbled, sending rates on 10-year benchmark state and local government debt higher by 22 basis points, the most since records began in 2011.

– The yen surged 1%, while the euro advanced with the pound.

– Crude sank 4.2% to sink below $33 a barrel.

– Asian equities lost 1.7%.

U.S. stocks extended their three-week slide as investors grappled with the potential economic hit from the virus that is upending daily routines around the world. Policy makers are seeking to assure traders they’re on alert, with the ECB indicating it may move as soon as this week, the Bank of England cutting rates and German Chancellor Angela Merkel pledging to do “whatever is necessary” to bolster the economy.

In the U.S., the Trump administration continues to promise “major” stimulus, but details remain uncertain. Democrats plan to urge the president to declare a national state of emergency. Markets are now growing worried that whatever does come will not have the ability to stave off a major blow to the world’s largest economy.

“Every day we get whipsawed back and forth, and what we’re seeing today is general disappointment that fiscal policy is not at all clear in how it’s going to stimulate the economy,” said Michael Reynolds, an investment strategy officer at Glenmede Trust Co.

Crude’s plunge into the $30s this week is causing upheaval well beyond oil markets, as the price war between Saudi Arabia and Russia threatens budgets in producing countries and hammers market values of listed energy companies. State-run Aramco, the world’s biggest exporter, known officially as Saudi Arabian Oil Co., fired the first salvos by slashing pricing for its crude and saying it would flood the market with a quarter more oil in April.

Iraq cut the official selling price for its Basrah Light crude for buyers in Asia by $5 a barrel for April shipments, according to an announcement on Tuesday. That’s less than the $6 reduction for Aramco’s comparable Arab Medium grade. Kuwait reduced its selling price to Asian customers by the same as the Saudis.

The UAE, only major producer that still sets prices retroactively, lowered the cost of its four grades for February sales by $1.63 a barrel from January. However, its benchmark Murban crude is being sold at a deeper discount in the spot market. All three producers ship a large portion of their exports to Asia.

By not pricing its crude as cheaply as Aramco’s, Iraq may prevent fanning the flames of the Saudi-Russian dispute.

“Any price war to acquire the largest market share does not serve the interests of the producing countries,” Iraqi Oil Ministry spokesman Asim Jihad said Tuesday. His country is trying to bridge oil producers’ viewpoints to reach a deal to stabilize and rebalance markets, he said in a statement.

Iraq’s state oil-marketing company, SOMO, plans to increase exports in April, according to a person with knowledge of the matter, who asked not to be identified because the information isn’t public. Shipments from the country’s southern port of Basra and oil that SOMO ships by pipeline through Turkey will rise to 3.6 million to 3.7 million barrels a day, the person said. SOMO sold 3.44 million barrels daily in March, according to Bloomberg tanker tracking data.

Middle Eastern producers sell much of their oil under long-term contracts, setting what are known as official selling prices, or OSPs, to let customers know what they’ll pay for future cargoes. Other Persian Gulf producers often follow Aramco’s pricing lead.

Kuwait set its April Export Crude OSP for Asian customers at a $4.65 a barrel discount to the regional benchmark, according to a price list seen by Bloomberg. That’s 60 cents lower than Aramco’s Arab Medium and $1.45 below than Iraq’s Basrah Light to the region. Kuwait’s exports to Northwest Europe were set at a record-low of a $12.60 discount.

The UAE’s Abu Dhabi National Oil Co. has “always set a fair and reasonable retroactive price for its crude that is consistent with market conditions,” Adnoc said in a statement Tuesday. The state-owned company is likely to change its pricing method when it introduces Murban futures later this year.

Murban crude to be loaded in May traded in bigger discounts in the spot market, with a cargo trading as low as $2.10 a barrel discount versus a low of $1.20 last month.

Riyadh said it will boost capacity to an unprecedented 13 million barrels a day, doubling down on Tuesday’s pledge of extra output in April. The UAE, a close Saudi ally, then promised to push more crude to customers than it can produce. These are fresh shots in an all-out war that has seen prices crash and the outlook for the market darken as nations prepare to pump as much as they can.

The moves come after an alliance between the OPEC cartel — effectively headed by the Gulf nations — and Russia collapsed acrimoniously last week. The country, for its part, has announced that it will retaliate by activating additional supplies of its own. Yet Moscow, which has nowhere near the quantities of untapped production held by the Gulf states, has also tempered its message, saying it remains open to resuming cooperation.

Until Friday, Saudi Arabia, UAE and Russia had been part of a global coalition known as OPEC+, which for the past three years had restricted crude output to shore up prices against a relentless tide of American shale oil. Only in July, Russia and Saudi Arabia touted their alliance as a marriage to “eternity”.

All of that has now spectacularly collapsed.

The deadly coronavirus has played its part. Saudi Arabia had been insisting for weeks that the group needed deeper production cuts to tackle the demand loss caused by the quickly spreading virus. Russia on the other hand resisted as it wanted more evidence of the impact on consumption.

The standoff has drawn in President Donald Trump, who spoke with Saudi Crown Prince Mohammed bin Salman by phone this week. It followed the Department of Energy denouncing “attempts by state actors to manipulate and shock oil markets.” The department didn’t name Saudi Arabia nor Russia.

The kingdom’s de-facto leader is, however, showing no signs of relenting. The country’s energy ministry, headed by Prince Mohammed’s half-brother, ordered Saudi Aramco to boost its output capacity by 1 million barrels a day, the first increase in at least a decade.

Saudi Arabia’s plan “isn’t the best option” in the current market, Russian Energy Minister Alexander Novak told reporters in Moscow.

Abu Dhabi National Oil Co. will supply 4 million barrels a day of crude to customers in April, it said on Wednesday. That would mean adding more than 1 million barrels a day to what the UAE pumped in February. The country’s output capacity is 3.5 million barrels a day, according to the International Energy Agency.

Saudi Arabia and its allies are also slashing prices for their oil in an attempt to push out Russian crude and secure market share. Iraq and Kuwait followed Aramco in cutting rates to customers all over the world.

A Russian response could come as early as Thursday, when the officials from the Energy Ministry will meet oil company executives. They will discuss their output plans and situation in the market, Novak said.

Oil prices resumed their decline on Wednesday, sliding back toward the four-year lows hit on Monday. Brent futures traded near $36 a barrel in London, less than half the level the Saudis need to cover government spending.

Policymakers reduced rates from 0.75 per cent to 0.25 per cent, taking borrowing costs back down to the lowest level in history.

The bank said it would also free up billions of pounds of extra lending power to help banks support firms.

It comes as the chancellor is expected to announce further measures to support growth and jobs in the budget later in the day.

Mark Carney, the outgoing governor of the Bank of England, said policymakers had seen a “sharp fall in trading conditions”, including spending on non-essential goods.

“The Bank of England’s role is to help UK businesses and households manage through an economic shock that could prove large and sharp, but should be temporary,” he said, adding that bank’s co-ordinated action on budget day was designed to have “maximum impact”.

Chancellor Rishi Sunak has pledged to help the UK battle the impact of the coronavirus, saying the NHS will get “whatever resources it needs” during the crisis, while he is also expected to unveil measures to boost the self-employed and small businesses who are left out of pocket.

The interest rate cut was part of a package of measures introduced by the bank to support the economy.

It also announced a new £100-billion scheme to help ensure households and businesses – particularly small and medium-sized firms – benefit from the reduction in interest rates.

The SET Index fell after the number of confirmed Covid-19 infections in Thailand rose to 59 with the announcement of six more cases.

A stock analyst at Krungsri Securities expected the SET Index to move between 1,250 and 1,285.

“Although the global markets have recovered due to investors’ expectation of the US launching economic stimulus measures, details of these measures are still unclear,” the stock analyst said.

“Therefore, we believe that this factor would benefit the market in the short term, while there is a risk that the market would fluctuate again if the US does not issue these measures.”

The top ten stocks with the highest trade value today were PTT, PTTEP, BAM, GULF, ADVANC, CPALL, AOT, PTTGC, BGRIM, and GPSC.

Elsewhere in Asia, Japan’s Nikkei Index closed at 19,416.06, down 451.06 points, or 2.27 per cent.

China’s Shanghai SE Composite Index closed at 2,968.52, down 28.24 points, or 0.94 per cent, while Shenzhen SE Component Index closed at 11,200.05, down 203.42 points, or 1.78 per cent.

Hong Kong’s Hang Seng Index closed at 25,231.61, down 160.90 points, or 0.63 per cent.

South Korea’s KOSPI Index closed at 1,908.27, down 54.66 points, or 2.78 per cent.

Taiwan’s TAIEX Index closed at 10,893.75, down 109.79 points, or 1.00 per cent.

At 3.54pm, buying price of a gold bar was Bt24,600 per baht weight and selling price Bt24,700, while buying price of gold ornaments was Bt24,149.88 per baht weight, selling price Bt25,200.

Gold contracts in COMEX futures to be delivered in April dropped by 1.35 per cent to US$1,653.1 per ounce at Tuesday’s close due to investors selling their safe haven assets and turning to risk assets amid hopes of economic stimulus measures, the strengthening dollar, and rising oil prices.

Investors responded to US President Donald Trump’s move to issue economic stimulus measures, including reducing payroll tax and other urgent measures to relieve impact from the Covid-19 outbreak.

Investors expect the US Federal Reserve to cut interest rate by up to 1 per cent at its the meeting on March 17-18 next week, despite the Fed having made an emergency interest rate cut by half a percentage point last week.

But he warned that Thailand will likely lose a third of its trade privileges under the Generalised System of Preferences (GSP) next month because it is unwilling to change its labour laws, as Washington demands.

Asked about the impact of the US-China trade conflict on the Thai economy, DeSombre noted that the two countries had completed Phase 1 of negotiations on a trade agreement and the US was looking forward to closing out Phase 2.

In Southeast Asia, Vietnam in particular has benefited from US companies relocating facilities from China, he said.

Once the new US government is in place early next year, he plans to encourage more US firms to move their factories to Thailand and the region. Some are interested in investing in Thailand’s Eastern Economic Corridor and other parts of the country, he said.

Washington is poised to revoke GSP import tax privileges for Thai products next month because of what it considers substandard labour practices here. The value of those privileges has been put at $1.3 billion, covering more than 500 categories of exported products.

The revocation comes into effect on April 25.

“This has been a long process, and to avoid that removal of the preferences would require various changes to labour laws that the Royal Thai Government was not willing to do.

“So, at this stage, there really is no opportunity to prevent the loss of the preferences. It is important to note, however, that even after the loss of that one-third Thailand will still be the largest beneficiary of the GSP at over $3.4 billion. So, it has to be kept in perspective,”  DeSombre said.

Lobbyists and non-governmental organisations persuaded US policymakers that Thai labour laws failed to meet international standards, instead denying workers wage bargaining power and the right of assembly.

Regarding the string of pro-democracy protests being waged by students nationwide, DeSombre said the US supports democracy but “does not choose sides”, rather letting sovereign nations develop their own systems of democracy. “Democracy is messy and challenging,” he said.

Because of bipartisan politics at home, he does expect the post-election US government to remain as deeply committed to the Asia-Pacific region. Republicans and Democrats advocate similar Pacific strategies.

He plans to invite members of Thailand’s Parliament to visit the US Congress to observe how democracy work there.

DeSombre said the US will strengthen trade and investment with Thailand based on the Treaty of Amity and Economic Relations signed in 1966. Washington will also continue to press Bangkok on security cooperation and sub-regional Mekong development, he said.

The Bangkok embassies of the US and Canada and the European Union in Brussels recently raised concerns over the Constitutional Court’s ruling that the Future Forward Party had to be dissolved.

The foreign governments said the verdict had the potential to disenfranchise the party’s six million supporters in the 2019 polls of their political rights.

US President Donald Trump has postponed a planned US-Asean summit in Washington. He had invited Asean leaders to meet him in Washington in the first quarter of this year in lieu of his attending the Asean Summit in Bangkok in November.

President Trump nominated Michael G DeSombre to be ambassador to Thailand last July and his posting was confirmed by the US Senate this past January 8.

He previously worked as a partner in the law firm of Sullivan and Cromwell, in charge of mergers and acquisitions in Asia.

DeSombre has more than two decades of experience representing and negotiating on behalf of American and international clients in large-scale investment and economic-development projects in Asia, gaining insight into the political, legal and strategic challenges that face American interests in the region.

He graduated from Stanford University with a bachelor’s degree in quantitative economics and a master’s in East Asian studies and received his doctorate of jurisprudence from Harvard Law School. He is married with four children.