Thai stocks sink as martial law declared

By: 11 years ago

Two motorcyclists ride past cosmetic advertisement signs in downtown Chiang Mai, northern Thailand, Monday, May 19, 2014. Thailand’s economy contracted by 2.1 percent in the first quarter, slammed by a protracted political crisis that is likely to slow growth for the rest of the year. AP

HONG KONG — Thailand’s stock market and currency fell Tuesday after the military declared martial law in what it called an attempt to stabilize the country’s precarious political situation.

The benchmark SET index in Bangkok dropped 1 percent to 1,397.48. The dollar spiked to about 32.65 baht before easing to about 32.50 baht.

Bangkok remained calm after Thailand’s military took control of public security nationwide, surrounding police headquarters in the capital as they broadcast the announcement before dawn from multiple television stations. It requested TV channels run by opposing political camps to suspend broadcasts.

The move, which the military insists is not a coup, follows months of anti-government demonstrations and a refusal by the caretaker prime minister to step down.

The unrest has hurt the Thai economy, which shrank 2.1 percent in the first quarter from the fourth quarter, according to data released Monday.

“The last thing the economy needs is further political instability,” said Michael Every, head of Asia Pacific financial market research at Rabobank. He said that “martial law will almost certainly hit near-term tourism arrivals.”

Stocks were mostly higher elsewhere in Asia, following a small gain on Wall Street.

Tokyo’s Nikkei 225 rose 0.9 percent to 14,135.42 and Hong Kong’s Hang Seng was up 0.8 percent to 22,776.28. South Korea’s Kospi slipped 0.3 percent to 2,009.22.

China’s Shanghai Composite Index edged up 0.2 percent to 2,008.39 and Australia’s S&P/ASX 200 inched up 0.1 percent to 5,416.30.

On Wall Street, the S&P 500 index rose 0.4 percent to close at 1,885.08 and the Dow added 0.1 percent to end at 16,511.86. The Nasdaq composite index rose 0.9 percent to 4,125.82.

The euro rose to $1.3712 from $1.3709 in late trading Monday. The dollar strengthened to 101.54 Japanese yen from 101.49.

Benchmark crude oil for June delivery was up 9 cents to $102.20 in electronic trading on the New York Mercantile Exchange. The contract rose 53 cents to settle at $102.11 on Monday.