Thailand gained 1.1% overnight, putting the SET Index in bull market territory (20% above this year's low) amid hope the military takeover will stabilize things enough for the economy to get motoring again. An index of consumer confidence rose to 70.7 in May from 67.8 in April, the first gain in 14 months.
Last week, the military lifted the curfew in Bangkok after earlier easing restrictions on Thailand's main tourist cities.
Chaturon Chaisang, a former education minister who was hiding until recently was arrested by the military while he was being interviewed by foreign reporters.
"I just want to warn General Prayuth that harsh measures will not help,” says Chaisang. “To be biased against one side of people, is not going to help. And if you really want to resolve the problems of the country, don’t be oppressive. Allow people to participate in the process."
In his address yesterday, the army chief said “everyone was suffering” as a result of the past six months of political uncertainty, and that it is time to “restore political and social stability, as well as confidence.”
"The market has been quite resilient,” Stock Exchange of Thailand President Charamporn Jotikasthira said today in a Bloomberg interview. “What happened in the past several months, we were in a political deadlock and as a result we were not able to move the economic engine properly. So we just have to reset the system and get back to normal as soon as possible.”
Resilient indeed. The SET gained 0.3% overnight and has largely held its YTD gains since the coup. THD +6.3% YTD
Hundreds of people in Bangkok have demonstrated against Thailand's military junta despite a warning by army chief Prayuth Chan-ocha, who carried out a coup last week, not to hold rallies.
Yesterday, the military dissolved the Senate and took on its legislative powers. The military has also detained well over 100 people, included ousted prime ministers, and told dozens of others to turn themselves in.
The army has appointed Air Chief Marshal Prajin Juntong to run economic ministries, including finance, commerce, industry and energy. Prayuth said on Friday that he would only "return power to the people" after economic, social and political reforms.
The U.S. has canceled military exercises in Thailand and threatened to cut military assistance. A question is whether the U.S. will start to cut economic ties.
In a volatile session amid the military coup, Thailand closed down 0.6% after tumbling more than 2% earlier. "We view the current military coup as likely overall positive as it creates a more stable environment," says Templeton's Mark Mobius.
Two days after declaring martial law and saying there was no coup, Army Chief Prayuth Chan-Ocha took to national TV to say he's seizing control in order to restore the peace. It's the 12th military takeover since 1932.
The move comes after months of street protests and the recent removal of the caretaker government of Yingluck Shinawatra by the Constitutional Court.
A day after the army declared martial law and stocks fell 1.1%, Thailand's SET index gained 0.6%, with Army Chief Prayuth Chan-Ocha pledging this is not a coup, and that military control will be short. There have been about a dozen coups in Thailand since a constitutional monarchy was set up in 1932.
Thailand's military chief General Prayuth Chan-ocha has imposed martial law as he looks to restore order following six months of sometimes violent and even deadly protests, although Chan-ocha denied that the military had carried out a coup.
Chan-ocha's action comes amid a period of limbo for Thailand after a court dismissed Prime Minister Yingluck Shinawatra and nine ministers earlier this month for abuse of power.
The turmoil in Thailand has brought the economy to the edge of recession, with GDP dropping 2.1% in Q1. Fitch's Andrew Colquhoun indicated that martial law might even be good for the economy if it averts more serious disorder and leads to the return of a fully functioning government that can pass a budget for next year.
Thailand's SET stock index fell 0.9%, while the USD-THB is +0.1% to 32.525 Thai baht.
Adding to yesterday's charges which forced the resignation of PM Yingluck Shinawatra, she now may face criminal proceedings as the National Anit-Corruption Commission finds her guilty of mishandling a multi-billion dollar rice subsidy program.
"The opposition will use other judicial challenges to peel off more cabinet members and seek to erode this caretaker government ability to govern in any capacity over the coming weeks," says Eurasia Group.
Unsurprisingly, foreign investors exited, pulling $234M out of Thailand debt yesterday, the biggest withdrawal in nearly two months.
The Constitutional Court has ruled against PM Yingluck Shinawatra and nine of her cabinet members, and appointed Niwattumrong Boonsongpaisan as caretaker Prime Minister.
At issue was whether she abused her power by transferring the national security chief in 2011 apparently for the benefit of her Pheu Thai Party. Ms Yingluck denied allegations and stated she didn't receive any benefit from the appointment.
There are several other cases pending against Ms. Yingluck as well.
Thai stocks have been mostly ignoring the political troubles over the past few weeks and were little-changed overnight.
Thailand's SET index lost 1.2% to 1,404.01 amid political tension, with the Constitutional Court and National Anti-Corruption Commission still expected to rule against caretaker PM Yingluck Shin and force her and her cabinet to step down.
Thailand's SET index gained 0.46% to 1,421.48 with an inflow of foreign money overcoming domestic political tension as the Constitutional Court and National Anti-Corruption Commission could soon rule against caretaker PM Yingluck Shin and force her and her cabinet to step down.
In Thailand, general optimism in emerging markets and foreign investor interest helped the SET Index gain 0.46% to 1,421.48. Foreign investors and local institutions were net buyers, while brokers and individual investors were net sellers. ETF: THD.
Philippine Stock Exchange index closed 0.52% higher to 6,742.97 on the back of 6.1% gain in Philex Mining. ETF: EPHE
Indonesia Index closed 0.03% lower to 4,838.76. ETFs: EIDO, IDX, IDXJ
Indonesia's Jakarta Index closed higher by 0.4% to 4,840.15, as the rupiah continues its slide to finish down 1.7% on the month. The presidential election is set for July 9 and frontrunner Joko Widodo's party doesn't have enough parliamentary support to form a government without a coalition partner. The country awaits his selection of a running mate.
The iShares MSCI Thailand Capped Investable Market Index Fund (the “Fund”) seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the MSCI Thailand IMI 25/50 Index (the “ Underlying Index”).
See more details on sponsor's website