PUBLISHED : 4 Mar 2024 at 15:19
Thailand plans to increase its crackdown on unlawful brief promoting as shares stay within the doldrums, based on the inventory change’s chairman.
Market authorities are contemplating altering the legislation to allow them to file fees in opposition to each people and corporations for such trades, mentioned Pichai Chunhavajira, chairman of the Inventory Alternate of Thailand (SET). Present guidelines enable just for punishment in opposition to securities firms that submit the short-selling order, he mentioned.
Thailand has joined friends akin to China and South Korea in tightening curbs on brief promoting after about $156 billion of market worth was worn out from the nation’s equities from a peak in 2023. Prime Minister Srettha Thavisin has urged market authorities to assessment oversight of improper transactions together with brief promoting to spice up traders’ belief and confidence.
“There’s an pressing want for extra steps to ease traders’ concern and restore their belief,” Mr Pichai, who was appointed because the bourse’s new chairman in February, mentioned in an interview. “The short-term measures will revive some confidence, however we nonetheless should do extra.”
The inventory change final month revealed extra particulars about proposed stricter measures on brief promoting and program buying and selling. These embrace a discount out there worth of inventory allowed for brief promoting and elevated fines for securities firms that breach guidelines. Bare brief promoting — promoting shares with out borrowing them first — is being banned.
The benchmark SET Index has dropped greater than 3% thus far this yr, among the many worst in Southeast Asia, after falling 15% in 2023. Day by day buying and selling turnover is down greater than 10% from a yr earlier on decrease orders from particular person shareholders, based on knowledge compiled by Bloomberg and the inventory change.
Quick-selling transactions account for about 10% of whole buying and selling turnover, based on the change’s knowledge courting again to September. The bourse started releasing the numbers after complaints in regards to the potential hyperlink with the market hunch.
The SET can even suggest some adjustments within the legislation to facilitate the providing and buying and selling of digital belongings akin to funding and utility tokens, mentioned Mr Pichai. Srettha has provided some pointers for the bourse to advertise itself because the buying and selling centre for digital belongings in Southeast Asia, he mentioned with out elaborating.
The urged adjustments to current laws have been proposed in discussions with the finance ministry, Securities and Alternate Fee and different legislation enforcement companies, based on Mr Pichai.
