The investment climate, which had recently eased following global markets' positive response to progress in peace talks between the U.S. and Iran, has become fragile once again as tensions in the Middle East intensify.
This uncertainty has led many brokerage firms to advise investors to shift into a "de-risking" mode, as markets continue to face risks from ongoing conflict and upward pressure on bond yields.
This is especially relevant as markets await inflation data and updates on diplomatic negotiations, which remain uncertain regarding their ability to bring a lasting resolution to the conflict.
The Middle East situation, which seemed to be easing, has stirred global market concerns again after peace talks between the U.S. and Iran in Switzerland failed to produce clear conclusions. Meanwhile, Donald Trump signaled that the U.S. is ready to resume military operations if negotiations collapse.
Meanwhile, worries over oil transportation have resurfaced after Iran announced the closure of the Strait of Hormuz, a critical global oil shipping route, while fighting between Israel and Hezbollah in Lebanon continues.
However, some positive signs have emerged as reports indicate that some commercial vessels have resumed passage through the Strait of Hormuz, despite many ships still waiting in the high-risk area.
This ongoing uncertainty has returned financial markets to a cautious stance. Most investors remain unsure if the situation will ease soon and worry that prolonged conflict may disrupt global oil supplies.
Therefore, close monitoring of developments is essential, as any escalation could further impact global investment sentiment going forward.
Research from Asia Plus Securities indicates that global stock markets are again under pressure from war risks and rising bond yields, following unexpected renewed tensions between the U.S. and Iran. This has kept oil prices elevated, fueling concerns of renewed inflationary pressures, while U.S. 10-year Treasury yields have risen to 4.52%.
Regarding the Thai stock market, although hopes for conflict resolution previously existed, the index has declined for five consecutive days alongside continuous foreign fund outflows, indicating that foreign investors have yet to significantly increase their investment weights.
As a result, there remains a risk that the market could face pressure if global investment sentiment shifts back toward risk reduction.
Accordingly, the recommended strategy is to adopt a de-risking approach focusing on three groups:
Dao Securities (Thailand) stated in their analysis that U.S.-Iran negotiations remain difficult and require more time for resolution, leading the Thai stock market to likely move sideways awaiting new factors, with a weekly index range forecast between 1,550 and 1,590 points.
Investment strategy advises selecting stocks that have deeply corrected recently, such as power companies like BGRIM, tourism stocks BA and CENTEL, as well as HMPRO, CPALL, CRC, and SCC, which remain attractive.
Meanwhile, banking stocks will depend on the outcome of the Bank of Thailand's policy meeting on 24 June.
Innovest X Brokerage's morning analysis estimates the Thai stock index will fluctuate between 1,550 and 1,620 points, with upside limited by the Federal Reserve's hawkish stance and Middle East uncertainties. However, funds are expected to start flowing into real sector stocks, which have lagged, to support the market.
The main strategy remains "Selective Buy" across three themes:
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