Thailand Bans Short Selling Amid Global Market Volatility

• Thailand’s SET imposes a temporary short-selling ban to stabilize the stock market.
• The SET introduces price band adjustments and market surveillance to address volatility.
• Global markets, including China and Taiwan, face sharp declines due to tariff tensions.

In an effort to protect its stock market from the ongoing global financial turmoil, the Stock Exchange of Thailand (SET) has announced a temporary ban on short selling. This decision follows a significant market decline, affecting global and Thai stock exchanges. The SET’s Board of Governors (BoG) has also implemented new limits and security-specific price band adjustments, aiming to restore stability in the market.

The short-selling ban will be effective from April 8 to April 11, 2025. The BoG has also adjusted the ceiling and floor limits for all SET, d, and TFEX exchange markets. These measures are designed to prevent further downward pressure on prices. The SET plans to monitor the situation closely and will revise these rules as necessary based on market conditions.

This action by the BoG occurs due to stock market fluctuations in Thailand. Over the last month, 30 companies on the stock exchange released their tender offers of buybacks amounting to nearly $1 billion up to March end. These buybacks are viewed as a proposal to stabilize share prices and revive investors’ confidence. However, the current global market trend continues to cause concern among investors.

Global Market Declines

Major markets in the rest of the world are also down significantly. China’s stock market declined by 10%, the worst single-day drop since 2008. The same effect was reported in Taiwan, where the country’s overall stock market dropped by 9.8 percent, triggering the circuit breaker. Trading in Japan was also halted in identical circumstances to the Nikkei 225 futures. Europe also declined, led by the UK & Germany, down by more than 4% in the futures of their respective stock markets.

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This is mainly due to President Donald Trump’s tariff actions, which have led to widespread market decline. Trump has continued to support these actions even though they triggered shocks in world markets. He stated:

Some day people will realize that Tariffs, for the United States of America, are a very beautiful thing.

The short-term situation led the SET to decide to ban short-selling and put measures in place to ensure that the Thailand stock market was not affected by the volatile global market. These measures are taken to restore investor confidence and put Thai financial markets back on the right track.

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