Thai stocks are likely to rise next week amid hopes for an interest rate cut and government stimulus measures aimed at lifting the country's sluggish economy, dealers said.
"The main supporting factor is the rate cut. Investors already factored in the interest rate cut," said Chai Chirasevenupraphand, a market strategist at Capital Nomura Securities.
The Bank of Thailand is expected to slash its key interest rate to 3.5 percent from the current 4.0 percent when it holds a rate-setting meeting on May 23. If it decided to lower the rate, it would mark the fourth cut this year. With the Thai economy slowing, business leaders have urged the central bank to cut the key interest rate more aggressively in a bid to spur depressed domestic consumption. Apart from the rate factor, investors are likely to turn buyers next week on growing hopes that the military-backed government will introduce additional economic stimulus measures including tax breaks, Chai said.
Market players are keen on tax measures aimed at boosting the economy, the analyst said.
Earlier this week, the government expanded its stimulus loan package for low-income earners to around two billion dollars from its initial 1.2 billion dollars. For the week to May 18, the Stock Exchange of Thailand composite index increased 21.86 points or 3.09 percent to close at 728.76.