Capital flees Thai stocks as baht extends losses

KUALA LUMPUR, 7 AUGUST 2026 —

Thai stocks suffered RM2.7 billion in net outflows in the first quarter, the worst start since 2008, as the baht fell to a 14-month low and US Treasury yields climbed, according to Maybank Securities.

The Stock Exchange of Thailand’s benchmark SET Index fell 1.2% on Wednesday to close at 1,546.75 points, its third straight day below 1,600 and more than 11% below its late-2023 peak. The baht weakened to 35.6 per dollar, the lowest since January 2023, after the central bank unexpectedly held its policy rate at 2.5% last month.

Net foreign selling reached RM654 million in March alone, the largest monthly outflow since the third quarter of 2023, Maybank said. Year-to-date, non-residents have sold RM922 million of Thai shares, pushing the year-on-year outflow to RM1.52 billion, according to SET data.

The outflows deepened after the Bank of Thailand kept rates on hold while the US Federal Reserve signalled slower rate cuts. “The baht’s depreciation and rising US yields are pressuring Thai equities and accelerating capital flight,” said Chayawit Akaraphol, head of research at Maybank Securities.

Foreign investors dumped another RM1.06 billion on Tuesday, according to SET data. Year-to-date outflows stand at RM1.85 billion, already surpassing the RM1.08 billion recorded in the same period last year. The baht’s drop to 35.23 per dollar on Wednesday marked a two-month low.

“Investors are rushing to exit as the baht weakens and US yields rise,” said a trader at a local brokerage. Thin liquidity and widening bid-ask spreads have amplified the sell-off, with foreign outflows in March reaching RM682 million, the highest since December 2022.

The SET’s forward price-to-earnings ratio has fallen to 14.6 times, while the trailing 12-month price-to-book ratio dropped to 1.92 times, levels last seen during the 2022 market trough. Maybank expects earnings downgrades to continue into the second quarter as sentiment remains fragile.

“If the baht stays weak and US yields keep rising, Thai equities will likely extend losses,” Akaraphol said. The brokerage cut its 2024 earnings forecast for the SET by 3% on Wednesday, citing weaker domestic consumption and softer tourism recovery.

Related: Stock Exchange of Thailand (SET)