BANGKOK - The world's worst-performing stock market may have a tough time luring back fleeing foreign investors, with its struggling economy poised to erode corporate earnings further.
"The economy continues to struggle, and that's leading to earnings downgrades for a lot of companies," said Gordon Fraser, who helps manage about US$45 billion as a global emerging-market equities fund manager at BlackRock Inc. in Hong Kong."It's not a country we're particularly compelled to add capital to right now."
The Thai government forecasts 2019 economic growth will slow to 2.6 per cent, the weakest in five years, while most of the 100 largest companies on the country's exchange reported July-to-September earnings that were lower than analysts' estimates, according to data compiled by Bloomberg. It was the fourth straight quarter of worse-than-expected results, the data showed.
A historical pattern of foreign fund outflows in the fourth quarter will damp any"significant gains" in Thai stocks, according to SCB Asset Management, the nation's biggest private money manager.