The regional stock markets plunged in the morning session of December 4, 2019, after the U.S. President Donald Trump signaled that the trade deal might be delayed.
As of 9:18 local time in Thailand, Nikkei slipped 1.30%, SSEC dipped 0.38%, HSI fell 1.40%, ASX 200 sank 1.65% and Kospi plunged 1.00%.
Yesterday, SET closed at 1,567.63 points, slipped 1.90 points or 0.12% with a trading value of 44 billion baht.
Last night, Trump said in NATO summit that it might be better to wait until after the 2020 election to strike a deal with China which would be after November next year.
“In some ways, I like the idea of waiting until after the election for the China deal, but they want to make a deal now and we will see whether or not the deal is going to be right,” said Trump.
Dow Jones fell 280 points or 1.01%, S&P 500 lost 0.66% and Nasdaq plunged 0.55% while VIX rose 7.04%.
KGI Securities stated that the SET Index could extend its moderate loss into Wednesday, as global risk-off mode could become more obvious. Donald Trump last night splashed cold water on hopes of a trade deal, saying that it could be better to make a trade deal after the 2020 presidential election.
His comments weighed on US equities and led to a noticeable drop in treasury yield, a sign of risk aversion as now there are just about ten days before the December 15 deadline when US plans to collect 15% tariffs on consumer goods worth about US$160bn.
On the domestic side, Thailand’s cabinet yesterday approved the formation of a new tax-deductible fund to replace the current LTF. The newly set up fund, Super Saving Fund (SSF), requires buyers to hold the fund for 10 years and limits the tax deduction to Bt200k versus Bt500K under the incumbent LTF. While the decision could be positive to December LTF buying, long-term flows into SSF remain in doubt.