Thailand's capital market is emerging as a resilient investment destination in Southeast Asia this year, supported by strong corporate earnings, improving foreign investor confidence and attractive dividend yields, even as global markets face mounting geopolitical and economic uncertainties, the bourse says.
According to Soraphol Tulayasathien, senior executive vice-president of the Stock Exchange of Thailand (SET), Thailand is supported by solid economic and corporate fundamentals despite a challenging global backdrop.
Thailand's economy expanded 2.8% in the first quarter year-on-year, accelerating from 2.5% in the previous quarter, driven by stronger exports and investment activity.
Listed companies also reported impressive earnings growth, with net profit surging 25.3% from a year earlier, prompting analysts to revise earnings forecasts upward across several sectors, particularly energy and commodity-related businesses.
The benchmark SET index reached 1,568.37 points, its highest level in two years and nine months, rising 5% during the month and 24.5% from the end of 2025. The rally was fuelled by easing geopolitical tensions, lowered oil prices and continued investment in digital infrastructure, while robust first-quarter corporate earnings further reinforced investor sentiment.
Trading activity also strengthened significantly. Average daily turnover across the SET and Market for Alternative Investment rose 53.4% year-on-year to 66.5 billion baht in May, while foreign investors became net buyers of 3.37 billion during the month, bringing cumulative net inflows to more than 20 billion baht for the first five months of the year.
5T CHALLENGES
Despite the positive momentum, Mr Soraphol warned Thailand's economy and capital market must navigate five major challenges in the second half of the year, collectively known as the "5T" factors.
The first is Tehran, reflecting geopolitical risks stemming from tensions in the Middle East. The second is Trump, referring to policy uncertainty surrounding US political developments and their implications for global trade and investment flows.
The third challenge, tech, concerns uncertainty over whether artificial intelligence can generate sustainable commercial returns that justify current valuations, as well as the potential liquidity impact from large-scale fundraising by global technology firms.
The fourth factor, 10-year yield, highlights elevated US Treasury yields, which continue to influence global capital allocation and emerging-market fund flows.
Finally, the "Thai Chuay Thai" scheme underscores the importance of domestic stimulus measures and Thailand's ability to maintain internal economic resilience through government support and policy initiatives, said Mr Soraphol.
Amid these uncertainties, high-dividend stocks continue to serve as a key defensive pillar for the Thai market.
Foreign investors have shown particular interest in Thai banking stocks, many of which offer dividend yields exceeding 5%, comparable to US Treasury yields.
"Unlike many global technology stocks that are trading at elevated valuations, Thai equities are generally viewed as fairly valued, making them attractive for investors seeking stable returns and lower downside risk," he said.
At the end of May, the SET's dividend yield was 4.3%, significantly higher than the Asian market average of 2.9%.
RETURNING FUND FLOWS
Foreign investor sentiment towards Thailand has continued to improve, supported by stronger macroeconomic stability and a more favourable sovereign credit outlook.
SET president Asadej Kongsiri said foreign investors were net buyers of Thai equities worth roughly 22.6 billion baht between January and early June.
Thailand's diversified economic structure, covering the energy, tourism, healthcare, services and consumer sectors, has helped reduce market volatility and enhanced resilience compared with markets that rely heavily on a single growth driver.
Long-term investment prospects are also supported by Thailand's extensive infrastructure development pipeline, estimated to reach as much as 21 trillion baht by 2050, covering transport, energy and data centre projects.
Meanwhile, the SET is working with policymakers and market participants to develop the Thailand Investment Savings Account, aimed at encouraging long-term savings and broadening retail participation in the capital market.
The exchange also launched "wiset", a new digital investment platform that integrates information across stocks, bonds, and tax-saving funds, providing investors with easier access to market data, shareholder services and personalised investment insights.
"Thailand may also benefit from portfolio reallocations within Southeast Asia as investors seek alternatives following sharp declines in some regional markets. Alongside the Philippines and Vietnam, Thailand is viewed as a potential destination for capital seeking exposure to regional growth opportunities," noted Mr Asadej.
While future fund flows continue to depend on global interest-rate trends and investor allocation between developed and emerging markets, Thailand's combination of attractive dividend yields, improving policy credibility, strong corporate profitability and expanding investment opportunities positions it as one of the region's most compelling long-term investment destinations, he said.
