As the US presidential election approaches, analysts at Asia Plus Securities (ASPS) suggest that a win for Donald Trump could positively impact Thailand’s transport and industrial estate stocks. This stems from Trump’s protectionist trade stance against China, which could boost sectors in Thailand that complement US supply chain shifts.
How Trump’s Trade Policies Could Benefit Thai Transport Stocks
Under Trump’s policies, heightened tariffs on Chinese goods previously led to increased demand for imports from other countries, including Thailand. If re-elected, Trump’s protective stance could see more US companies rely on imports from countries outside China, such as Thailand, potentially driving gains in transport stocks.
Top Thai Transport Stocks Likely to Benefit
Shipping companies like Regional Container Lines (RCL), Precious Shipping (PSL), and Thoresen Thai Agencies (TTA) stand to gain if trade volumes rise due to new tariffs on Chinese goods. Increased shipping demand from the US would directly benefit these firms as they handle heightened order flows from markets needing to reroute away from China.
Industrial Estate Operators Could See a Surge in Demand
ASPS forecasts that a second Trump term could spur international firms to establish factories outside China, favoring industrial estates in Thailand. Companies might seek to circumvent potential tariff barriers by relocating manufacturing operations, creating opportunities for industrial estate developers.
Key Beneficiaries – Amata Corporation and WHA Corporation
Thai industrial estate giants like Amata Corporation (AMATA) and WHA Corporation (WHA) are well-positioned to support this shift. With increased demand for Thai-based manufacturing, these companies could experience accelerated growth as more firms seek alternative manufacturing bases.
Possible Challenges for Thai Exporters Facing Chinese Competition
While certain sectors may gain, Thai exporters in fields such as petrochemicals, electrical equipment, steel, and auto parts could encounter stiffer competition from Chinese counterparts. The US market’s increased protectionist policies might make these industries vulnerable as China ramps up exports to other countries, including Southeast Asia.
Potential Headwinds in the Petrochemical and Electrical Appliance Sectors
Petrochemicals and electrical appliances are at the forefront of products affected by tariffs, where intensified competition could pressurize Thai manufacturers. ASPS cautions that Chinese exporters, already competitive in price, could pose challenges in markets that rely on Thai imports.
Perspectives from Maybank Securities on Election Outcomes
Maybank Securities (Thailand) noted that the outcome of the US election would influence Thailand’s economic climate. A Trump win may prompt Thai policymakers to create favorable conditions for foreign investors, hoping to attract manufacturers impacted by China’s trade relations with the US. Conversely, if Kamala Harris wins, Maybank anticipates a positive boost to Thailand’s SET index, due to her more moderate trade and foreign policies.
Stock Market Forecasts Post-Election
According to Maybank, the Stock Exchange of Thailand (SET) index could end the year near 1,520 points. This forecast comes amid a trend of lower interest rates and improving domestic economic indicators, which play into a positive investment outlook regardless of the US election outcome.
Recommended Sectors and Stocks to Watch
ASPS and Maybank identified promising sectors and stocks likely to benefit from these shifts. For instance, in addition to transport and industrial estates, sectors such as tourism, banking, and power plants are highlighted for their resilience and growth potential.
Featured Stocks for Growth Potential
Noteworthy stocks include Asset World Corp (AWC) for its tourism and hospitality holdings, Global Power Synergy (GPSC) for its energy investments, and WHA for its industrial estate operations. These companies are set to benefit from renewed investor interest and positive market sentiment influenced by election-related policies.
Conclusion
The 2024 US election holds significant implications for Thailand’s economy, with Trump’s potential victory potentially catalyzing gains for transport and industrial estate sectors. While manufacturers in some industries may face heightened competition, policy shifts present promising opportunities for growth in Thailand’s stock market across various sectors.
