Key Highlights of the Quarterly ING Investor Dashboard Survey
Thailand index jumps 154% to 150 for Q4 2009 from 59 in Q4 2008; rises significantly by 33% quarter-on-quarter from 113 in Q3 2009
Pan-Asia Index jumps 101% to 147 for Q4 2009 from the financial crisis low of 73 for Q4 2008; confidence level in 2009 back at levels before the crisis
Thai investors continue to diversify investments in terms of geography and asset classes and demonstrate greater willingness to take on more risk
Thai investors bullish on local property market; among Pan-Asian countries, show biggest increase in expectations that property prices will rise in Q1 2010
ING, the global financial services group, today released data from its quarterly ING Investor Dashboard Survey which shows Thai investor sentiment rising dramatically with the Thailand Index jumping 154% to 150 for Q4 2009 from 59 in Q4 2008, and also registering the sharpest quarter-on-quarter increase (33%) among Asian countries.
The overall pan-Asia (ex-Japan) ING Investor Dashboard Sentiment Index also shows a significant 101% jump in investor sentiment in Asia for 2009, with overall confidence recovering to pre-global financial crisis levels. The Index increases to 147 for Q4 2009 from 73 for Q4 2008.
Quarter-on-quarter, the pan-Asia Index registers a modest increase of 3.5% from 142 for Q3 2009 as investor sentiment continues to climb at pre-financial crisis levels following the run-up in the financial markets in Q2 and Q3 2009, reflecting that there is confidence in the stability of the global recovery. The survey results show the highest investor sentiment score since the Index was introduced in Q3 2007 and the Index moves further into “optimistic” territory.
Published for over two years, the ING Investor Dashboard is the first quarterly survey in the Asia Pacific region to provide a pan-Asia (ex-Japan) investor sentiment index. Conducted quarterly across 12 markets The survey was conducted across 12 markets in Asia Pacific: Hong Kong, China, India, Indonesia, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand, Japan, and Australia. The pan-Asia investor sentiment index includes all Asia markets and excludes Japan and Australia. in Asia Pacific, it provides market insights into investor attitude and outlook and allows each market to be benchmarked and tracked against the overall investor sentiment across Asia using the Index.
Investor sentiment buoyed in markets experiencing export and consumption rebounds
Investor sentiment in export-driven markets including Hong Kong, Taiwan and Singapore, ended 2009 by rising more than 100% from a year ago, as regional economies recovered and exports began to improve from Q2 to Q4 2009. In Thailand, the Q4 2009 export and consumption rebound was reflected in significant increases in national exports and consumption indicators for Value Added Tax. Meanwhile, investor sentiment in China and India continues to be the highest in the region, with a 53% year-on-year increase in 2009 for China and a 122% year-on-year increase for India.
Commenting on the results, Mr. Tor Indhavivadhana, Senior Vice President, Mutual Fund & Investment Consulting Department, ING Funds (Thailand) Limited said, “Given that the third quarter of 2009 was a banner quarter for the Stock Exchange of Thailand, with the index up more than 20%, a surge in investor sentiment in Q4 2009 was not unexpected. The survey results show that 62% of Thai respondents considered their return on investment had increased in Q4 2009 whilst 71% of respondents believe their return on investment will continue to increase in Q1 2010. This is a significant turnaround from the last quarter's survey and in line with our expectations given the overall improvement in investment performance. Sentiment always follows market performance.”
"ING continues to remain confident in the Thai market as the economy and corporate earnings improve, supporting currently cheap valuations. However, investors should not expect the kind of aggregate returns experienced in 2009. With exports expected to grow by 10-15% in 2010, investors may be prudent to consider export-related sectors including shipping and export-related manufacturers. On the downside, concerns about inflation, which the Bank of Thailand has reported may reach 5% in 2010, could derail much of the present optimism and compel investors to retreat to what are considered safe havens - cash deposits, income funds and gold."
Thai investors remain positive about the economic situation
Thai investors are positive about their local economy and many are optimistic that the economy will continue to improve in Q1 2010 as the situation in the U.S. continues to improve.
Economic situation improved Q4 09 Q3 09
Thailand 65% 45%
(% of investors)
Economic situation will improve in the next quarter (Q1 10) Q4 09
62%
Thailand
(% of investors)
U.S. economy will improve in the next quarter Q4 09 Q3 09
Thailand 66% 55%
(% of investors)
As sentiment about the economy improves, Thai investors are more confident about their own personal financial and household financial situations for the next quarter (up 27% and 23%, respectively, compared to Q3 2009) In addition, Thai investors appear willing to take on greater risk with their investments.
“Though Thai investors remain fundamentally conservative, they have demonstrated what may be a short-term phenomenon in terms of their risk appetite. Growing ranks of Thai investors accept that achieving higher returns is virtually impossible if they maintain 'cash is king' conservatism in a low interest rate environment. Still there are underlying contradictions, with the majority of investors (65% of those surveyed) expecting 10-15% per annum returns, while 55% of these same investors can only tolerate a maximum capital loss of 10%. In this low yield environment Thai investors will not generate these desired returns without taking higher investment risk. Cash yields are virtually zero and if investors want to generate returns of 10% or so per annum they clearly will have to diversify their allocations towards equities, including global equities and alternative assets. The survey confirmed that, at least in the last quarter, this risk tolerance has taken hold, with investors increasing allocations in stocks (up 20%) mutual funds and unit trusts (up 26%) and REITs/real estate property funds (up 31%)," added Mr. Indhavivadhana.
Thai investors bullish on stocks and property and continue to see upside for Q1 2010
Thai investors continue to be positive on the local stock markets and see further upside in Q1 2010.
View on the stock market for Q1 10 Remains at current level or rises* Expected increase in the stock market
Thailand 87% 10.1%
*(% of investors)
Currently, 34% of Thai investors are invested in local stocks, with many invested in the financial services, energy, resources and consumer goods sectors; 7% are invested in overseas stocks.
"In terms of geographic diversification among investors, our Greater China Fund has been remarkably popular among Thai investors who want exposure to the growth of the Thai economy. We will be following this success with a fund devoted entirely to U.S. equities, which we believe presents long-term upside on a price valuation and yield basis, added Mr. Indhavivadhana."
Thai investors are also positive on the property markets, with 33% of investors expecting increases in the next quarter of 5% to less than 7.5 %, reflecting overall confidence that the government will continue to provide incentives for home buyers and the Bank of Thailand will continue to adopt its relative accommodative monetary policies.
View on local property market (residential real estate) for Q1 10 Remains at current level or rises* Expected average increase
Thailand 91% 4.7%
*(% of investors)
Inflation and interest rate hikes seen as risks in 2010
Rising inflation and interest rate hikes are seen by Thai investors as key risks in 2010. 57% of Thai investors expect domestic interest rates to rise in Q1 2010 while 62% expect domestic interest rates to rise in 2010. 64% expect inflation to increase in Q1 2010, while 85% expect inflation to increase over the course of the year.
“Expectations of imminent and fairly significant increases in inflation might become self-fulfilling quite quickly. Given this scenario and the Bank of Thailand’s forecast for 5% inflation in 2010, it would not be unreasonable to expect the Bank of Thailand to increase interest rates in the short term. Any impetus in that direction would be compounded by further spikes in oil and other energy related prices,” concluded Mr. Indhavivadhana.
For an introduction of the ING Investor Dashboard Sentiment Index and latest detailed (high-resolution) data charts, please visit http://www.ing.asia/investor_dashboard.
Press enquiries Tor Indhavivadhana ING Funds (Thailand) Co., [email protected] James BestAziam Burson Marsteller
About the ING Investor Dashboard
The ING Investor Dashboard survey measures and tracks investor sentiment and behaviour of mass affluent investors each quarter from 12 Asia Pacific markets (including China, Hong Kong, India, Indonesia, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand, Japan and Australia), and is the first quarterly survey in Asia Pacific which provides a specific industry benchmark for pan-Asia (ex-Japan) investor sentiment.
The Q4 2009 survey was conducted in December 2009 and involved online interviews with a total of 3,730 mass affluent investors across the 12 Asia Pacific markets. The respondents are aged 30 years and above, and have disposable assets or investments of US$100,000 and above, with the exception of Indonesia (disposable assets or investments of US$60,000 and above) and the Philippines (disposable assets or investments of US$60,000 or monthly income of Php200,000 and above).
The survey is conducted by international and independent research firm The Nielsen Company and is tracked extensively by major financial and business media organisations across all 12 markets in Asia.
Profile of ING
ING is a global financial institution of Dutch origin offering banking, investments, life insurance and retirement services. As of 30 September 2009, ING served more than 85 million private, corporate and institutional clients in more than 40 countries. With a diverse workforce of about 110,000 people, ING is dedicated to setting the standard in helping our clients manage their financial future.
About The Nielsen Company
The Nielsen Company is a global information and media company with leading market positions in marketing and consumer information, television and other media measurement, online intelligence, mobile measurement, trade shows and business publications. The privately held company is active in approximately 100 countries, with headquarters in New York, USA. For more information, please visit, www.nielsen.com.
Barakorn Petchnoi
Media Manager
Aziam Burson-Marsteller (ABM)
Bangkok, Thailand
Tel: +66 (0) 2252 9871 ext. 444
Fax: +66 (0) 2254 8353