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Energy stocks on the Stock Exchange of Thailand (SET) fell on Wednesday after a steep decrease in crude oil prices overnight, as investors faced mouthing fears of a global recession.
Petroleum supplier PTT Exploration and Production Plc led the fall by dropping 4.29 per cent from its prior closing to 156 baht as of the morning session.
Oil refinery Esso (Thailand) Plc (ESSO) lost 3.42 per cent to 11.30 baht, while Star Petroleum Refining Plc (SPRC) dipped 1.65 per cent.
Equity markets worldwide have come under a tailspin, as traders are worried that the Federal Reserve’s rapid interest-rate hikes to curb inflation will send the world economy into a spiral.
After market sell-offs the previous day, the SET index tumbled almost 11 point in the morning session to 1,530, the lowest level since August 2021.
“Global risk-off mode and a rally in the US Dollar Index, as safehaven trade, further drove Thai baht depreciation and continued foreign equity outflows,” said Rakpong Chaisuparakul, an analyst at KGI Securities.
The baht weakened to over 36 baht per US dollar, the lowest level in five years.
Rakpong noted that reports of a resurgence of Covid-19 outbreaks in China ascribed the downside risk to investor sentiment, given the economic impact of the strict lockdown.
Despite a drop in oil-related stocks, shares in power plant firms outperformed the broad market, as investors predict that falling oil prices might lower the company’s costs.
B.Grimm Power Plc (BGRIM) rose by 4.29 per cent to 36.50 baht. Gulf Energy Development added 1.6 per cent to 47.25 baht.