InnovestX Securities Company Limited revealed its economic outlook and investment strategy, raising Thailand's GDP forecast for this year to 1.6%, benefiting greatly from the investment cycle in technology and AI industries combined with government economic stimulus measures supporting domestic consumption.
At the same time, the company increased its SET Index target for 2026 to 1,550–1,600 points, projecting the index may correct downward in Q3 2026 before a strong recovery in Q4 2026, while highlighting attractive stocks for investment.
Dr. Piyasak Manasant, Chief Economic Researcher at InnovestX Securities, said the global economy is expected to recover in a U-shaped pattern, with short-term slowdowns caused by tighter global financial conditions, weakening European manufacturing, declining U.S. consumer confidence, and a K-shaped growth pattern in China.
However, the economy is anticipated to gradually recover in Q4 2026, supported mainly by technology investments and economic stimulus measures from various countries.
Regarding Thailand's economic outlook for 2026, the GDP forecast was raised to 1.6% from 1.4% based on a baseline scenario, mainly driven by private sector investment growth aligned with the AI trend cycle, digital industry, and electronics investments.
Additionally, benefits come from government economic stimulus measures, especially the 400-billion-baht emergency loan framework, which helps support private consumption despite inflation pressures at 3.2%.
In a best-case scenario, Thailand's economy could grow up to 2.0%, assuming progress in negotiations with Iran and a Constitutional Court ruling upholding the legality of a 200-billion-baht loan, which would boost public investment by up to 6.0% and exports accelerating to 9.5% due to rising global AI demand.
Nevertheless, challenges remain. In a worst-case scenario, GDP growth could slow to 1.2% if prolonged conflict pushes crude oil prices above 100 U.S. dollars per barrel, driving inflation to 4.4% and suppressing consumption to just 1.0%. Additionally, risks include a Constitutional Court ruling against energy measures, which could halt investments.
Sittichai Duangrattanachaya, Chief Investment Strategist at InnovestX Securities, said the overall Thai stock market is likely to decline in Q3 2026 before recovering in Q4 2026.
He raised the 2026 SET Index target to 1,550–1,600 points (up from 1,500–1,550 points) to reflect better-than-expected economic trends, estimating corporate earnings could grow by up to 20% year-on-year.
The reasons for the expected market pressure and correction in Q3 2026 stem from three main risk factors:
1. Geopolitical issues: The U.S.-Iran conflict remains volatile, especially as Iran clearly refuses nuclear negotiations, raising the risk of renewed clashes.
2. El Niño phenomenon: Severe weather impacts will pressure domestic purchasing power and inevitably affect the agricultural sector.
3. U.S. tariff policies: President Donald Trump has shifted from handling multiple issues simultaneously to focusing on one at a time. Once the Middle East issue is resolved, there is a high likelihood of renewed efforts to raise import tariffs, targeting trade partners including Thailand.
However, the Thai stock market still has key drivers that may limit downside risks and trigger recovery in Q4 2026, including a major AI investment cycle, the U.S. midterm elections, and the reopening of the Strait of Hormuz.
Therefore, the Q3 2026 investment strategy should emphasize appropriate defensive positioning, with strong and attractive stocks such as CENTEL, CPN, GULF, HANA, and WHA.
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