SET nose-dives in tandem with regional markets

BANGKOK: — The Stock Exchange of Thailand’s composite index nose-dived by more than 10 points at the opening bell of Wednesday’s morning trading session in tandem with other stock markets in Asia upon renewed concern over the sub-prime lending woes in the United States.

However, the index recouped its loss later and managed to close at 781.89, down 6.32 points or 0.83 per cent, with a thin trading value of Bt6.84 billion in morning trading.

An analyst said the index had dropped in parallel with those of neighbouring countries due to renewed worries over the sub-prime mortgage problems after there are some opinions that the US Federal Reserve might not cut the Fed fund rate at the upcoming meeting.

“Some analysts in the US market remain uncertain about the direction of the sub-prime lending problems and the interest rate. So,” said the analyst, “it put the Dow Jones Industry Average in tatters.”

The analyst projected the Bank of Thailand’s Monetary Policy Committee would decide to cut the short-term interest rate at its meeting on Wednesday.

“It is likely MPC will reduce the interest rate in a bid to stimulate the economy. Progress in the deliberation of the Deposit Insurance Institute Bill will make financial institutions, particularly small banks, attempt to survive by increasing deposit rates to narrow spread.”

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