Thai stocks end lower

Thai stocks fell more than two percent on Tuesday as energy shares came under pressure after a share swap deal at lower than market prices and bank stocks were hit by government approval of a plan to encourage mergers.
The energy sector index fell 5.14 percent, dragged down by a 14.3 percent drop by Ratchaburi Electricity Generating Holding to 42 baht and a 6.67 percent fall by shares in Electricity Generating (EGCOMP) to 84 baht.
They fell after state-owned Electricity Generating Authority of Thailand said it was buying a 15 percent stake in Ratchaburi from Banpu PCL, Thailand's top coal miner, at 43.8589 baht per share.
EGAT said it would also make a tender offer for Ratchaburi shares at the same price and that it would sell a 25.4 percent stake in EGCOMP to Banpu and CLP Power Projects (Thailand) Ltd for 82.5832 baht per share.
The benchmark Stock Exchange of Thailand (SET) composite index closed down 21.25 points, or 2.69 percent, at 769.68 points, while the big-cap SET 50 index dropped 3.42 percent to 50.52 points.
Turnover rose to 61.9 billion baht ($1.57 billion) from 44.13 billion baht on Monday.
The falls were in line with expectations as the market had been overbought since December, dealers said. The 14-day relative strength index for the SET index was at 72.29. A value of over 70 indicates a market is overbought.
"There was follow-through selling after heavy profit taking emerged near 800 points," said Piti Ketsiri, head of equity sales at BT Securities.
He said concerns about the declaration of martial law in three largely Muslim provinces in the south near the Malaysian border dampened spirits.
Malaysian investors, trading through branches of brokerage houses in the southern province of Hat Yai, cashed out from stocks to reduce risks.
The bank sector index fell 4.17 percent after the cabinet approved a plan to encourage bank mergers on Tuesday, pushing the overcrowded industry a step closer to consolidation and increased foreign competition.
Among the fallers were shares in Thailand's biggest bank, Bangkok Bank, which slid 4.67 percent to 102 baht, and the largest finance firm, National Finance, which fell 2.96 percent to 16.4 baht.
But shares in brokerages rose on hopes of impressive earnings for 2003, when the Thai stock market was the world's best performer, analysts said.
Shares in the biggest brokerage, Kim Eng Securities, rose 3.7 percent to 56 baht and number three Seamico Securities gained 2.3 percent to 13.6 baht.
Shares in brick-maker Quality Construction Products PCL soared 99 percent to 15.9 baht on their debut from an initial public offering price of eight baht with investors expecting the firm to draw strong earnings from the booming property sector, analysts said.