Thailand’s Government Pension Fund is boosting holdings of local equities after a bear market in the benchmark index sent valuations to the lowest levels in more than a year.
“This is a great buying opportunity,” Yingyong Nilasena, chief investment officer of the fund, which manages about $19 billion of assets, said by phone from Bangkok. “We have increased positions in some stocks recently. We plan to buy some more.” Yingyong declined to name specific companies.
The benchmark SET Index has fallen for the past nine days, the longest losing streak since 1998. The gauge has declined more than 20 percent from this year’s high as data this month showed the nation entered a recession in the second quarter, while foreign investors sold more than $1 billion of local shares. The SET index is valued at 11.4 times estimated profit for the next 12 months, the lowest level since July 2012, according to data compiled by Bloomberg.
“Overseas investors are too pessimistic about Thailand,” Yingyong said. “Many large-cap stocks are very attractive compared with their earnings outlook.”
Foreign investors sold about $1.2 billion of Thai stocks and about the same amount of local bonds this month amid speculation that the U.S. Federal Reserve will reduce monetary stimulus this year. Outflows from Indonesian shares totaled $464 million, while investors withdrew $219 million from Philippine equities.
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