The market chose optimism over anxiety, betting on chips over conflict.
On a Thursday weighted with geopolitical unease, Asian markets chose the future over fear — rallying on the strength of semiconductors and artificial intelligence even as American and Iranian forces exchanged strikes and oil routes through the Strait of Hormuz grew uncertain. In Thailand, a constitutional ruling cleared the way for 400 billion baht in emergency stimulus, offering the country a firmer footing amid a world still negotiating between conflict and growth. The moment captured something enduring about markets and human nature alike: the appetite for possibility tends to outlast the anxiety of the present hour.
- US-Iran military exchanges shattered a ceasefire and rattled energy markets, sending Brent crude briefly to $79 a barrel and pushing 30-year Treasury yields to their highest point since 2007.
- Despite the geopolitical turbulence, Asian chip and AI stocks surged, with Thailand's SET index closing up 0.6% at 1,621.55 — foreign investors poured a net 16.35 billion baht into Thai equities alone.
- OPEC+ moved to stabilize oil markets by raising production quotas by 940,000 barrels per day, while Saudi Arabia cut its Asia selling price by $11 a barrel for the first time in six years.
- Thailand's Constitutional Court handed the government a 7-2 ruling validating its emergency borrowing decree, unlocking fiscal stimulus and lifting both consumer and industrial confidence for the first time in four months.
- The IMF upgraded Thailand's 2026 GDP growth forecast to 1.9%, EV registrations surged 90% year-on-year, and inflation eased — but a stalled high-speed rail megaproject and declining tourism arrivals reminded observers that recovery is rarely uniform.
Markets across Asia climbed on Thursday, led by semiconductor and artificial intelligence companies, even as the United States and Iran exchanged fresh military strikes. The divergence was striking: investors appeared to weigh the promise of technological growth more heavily than the threat of regional conflict, sending indices higher from Tokyo to Bangkok.
Thailand's SET index ended the week at 1,621.55 points, up 0.6%, with foreign investors as net buyers of 16.35 billion baht. The advance was bolstered by a landmark legal ruling — Thailand's Constitutional Court upheld the government's 400-billion-baht emergency borrowing decree by a 7-2 margin, clearing the path for state-led stimulus spending that had been clouded by uncertainty.
The geopolitical backdrop remained volatile. President Trump declared the Iran ceasefire over as strikes were exchanged, slowing shipping through the Strait of Hormuz and pushing Brent crude to $79 a barrel before it eased to $76.30 on signals that Iran was seeking negotiations. The 30-year US Treasury yield reached 5.2%, its highest since 2007, while the Federal Reserve held rates at 3.75% with its members sharply divided on the next move. OPEC+ responded by raising production quotas by 940,000 barrels per day, and Saudi Arabia cut its Asia selling price by $11 a barrel — its first discount in six years.
Beyond the Middle East, Ukraine struck Russia's Omsk refinery — the largest and deepest such attack since the war began — while the UAE reported oil output at a six-year high. In the tech sector, Microsoft announced roughly 4,800 job cuts, Meta said it would begin producing its own AI chip in September, and Micron committed up to $3 billion to US semiconductor supply chains.
Back in Thailand, the economic picture was cautiously brightening. Inflation eased to 2.42% in June, diesel and gasoline prices were cut at the pump, and the Board of Investment approved $2 billion in new projects including a major Nestle expansion. Consumer and industrial confidence rose for the first time in four months, and the IMF lifted Thailand's 2026 growth forecast to 1.9%. Electric vehicle registrations surged 90% year-on-year, with more than 100,000 passenger EVs registered in the first half of 2026 alone.
Not all signals pointed upward. A long-delayed three-airport high-speed rail project collapsed after six years, with lead partner CP Group citing lender reluctance. Tourism arrivals remained below prior-year levels, and regulators were investigating share-purchase filing discrepancies tied to a significant stake in True Corp. Thailand's recovery, like the broader regional picture, was advancing — but unevenly, and against a world still very much in motion.
The markets had a choice to make on Thursday, and they chose optimism. Across Asia, stock exchanges climbed on the strength of semiconductor and artificial intelligence companies, even as tensions between the United States and Iran flared into fresh military exchanges. It was a moment that revealed something about how investors weigh risk: the promise of technological growth, it seemed, outweighed the threat of regional conflict.
In Thailand, the SET index closed at 1,621.55 points, up 0.6% from the previous week. The index had traded between 1,574.13 and 1,621.55 throughout the week, with daily turnover averaging 79.31 billion baht. Foreign investors were net buyers of 16.35 billion baht, while institutional investors sold 7.7 billion baht worth of shares. The advance came on the heels of a significant legal victory: Thailand's Constitutional Court had ruled 7-2 that the government's 400-billion-baht emergency borrowing decree was constitutional, removing a major source of uncertainty about the state's ability to spend on stimulus measures.
But the geopolitical backdrop was darkening. President Trump declared the ceasefire agreement with Iran finished as the two countries exchanged strikes, and shipping through the Strait of Hormuz began to slow again. Brent crude jumped to $79 a barrel in response, though it later eased to $76.30 after Trump indicated Iran had requested peace negotiations. The 30-year US Treasury yield climbed to 5.2%, its highest level since 2007, reflecting investor anxiety about inflation risks tied to the conflict. The Federal Reserve's minutes from the previous month showed a unanimous decision to hold interest rates at 3.75%, but the tone was hawkish—nine members favored at least one rate increase, while nine others preferred to hold or cut.
OPEC+ moved to contain the damage by agreeing to raise production quotas by 940,000 barrels per day, equivalent to 1% of global demand. Meanwhile, the geopolitical disruptions extended beyond the Middle East. Ukraine struck the Omsk refinery in Siberia, which processes 21 million tonnes of crude annually, marking the largest of eleven refineries hit by Ukrainian forces and the deepest strike inside Russia since the war began in 2022. The UAE, having left OPEC, reported its oil output had reached a six-year high of 3.8 million barrels a day in June. Saudi Arabia, meanwhile, cut its August selling prices for Asia by $11 a barrel—its first discount in six years.
Tech companies were making their own moves. Microsoft announced it would eliminate roughly 4,800 jobs, about 2% of its global workforce, as part of a restructuring that would hit its Xbox division particularly hard. Meta Platforms said it would begin manufacturing its own AI chip in September as part of a plan to boost computing power to 14 gigawatts by next year. Micron Technology committed to investing up to $3 billion to strengthen the US semiconductor supply chain.
Back in Thailand, the economic picture was mixed but trending upward. The Constitutional Court's decision had cleared the way for state spending, and the Board of Investment announced approval of $2 billion in new projects, including a 23-billion-baht expansion of coffee production by Nestle and new aircraft leases for Thai Airways International. Headline inflation for June rose 2.42% year-on-year, down from 2.74% in May, as oil price declines eased pressure. The Oil Fuel Fund reduced diesel prices by 2.56 baht per liter and gasoline by 2.51 baht, capping prices at 35 baht after Prime Minister Anutin Charnvirakul pushed for faster retail responses to falling global oil prices.
Consumer and industrial confidence both rose for the first time in four months in June, buoyed by falling energy costs and government co-payment schemes. The International Monetary Fund upgraded Thailand's GDP growth forecast for 2026 to 1.9% from 1.5%, though it cut its global growth forecast to 3% from 3.1%, citing geopolitical tensions and inflation risks. Electric vehicle registrations surged, with more than 100,000 passenger EVs registered in the first half of 2026—a 90% increase year-on-year and accounting for 30% of the car market. Full-year registrations are expected to exceed 150,000 units, up from 118,490 in 2025.
Not everything was moving forward smoothly. The Securities and Exchange Commission was investigating discrepancies in share purchase filings from 2021-25 by an unnamed investor who had recently reported acquiring a 7% stake worth 32 billion baht in True Corp. CP Group, the lead partner in the Asia Era One consortium, said it could no longer proceed with a three-airport high-speed rail project after six years of delays, as lenders no longer found it viable. The government was reviewing its options, which could involve a fresh bidding round or restructured project terms. Tourism arrivals remained a concern: 530,000 foreign visitors arrived in the week ending July 3, but year-to-date arrivals of 16.2 million were down 3.1% from the same period the previous year.
Citações Notáveis
The government's 400-billion-baht emergency borrowing decree was constitutional, clearing the way for fiscal stimulus spending.— Thailand's Constitutional Court ruling
Iran had reached out to request peace negotiations, easing oil market panic after initial price spikes.— President Trump's statement on Iran ceasefire
A Conversa do Hearth Outra perspectiva sobre a história
Why did Thai stocks rise when there's a war brewing in the Middle East?
The market was looking past the immediate threat. The Constitutional Court's approval of the emergency borrowing decree meant the government could finally spend on stimulus—that's what moved the needle. Chip and AI stocks were rallying across Asia, and foreign investors were buying Thai shares. The geopolitical risk was real, but it wasn't the dominant story.
So oil prices spiked but then came back down. What changed?
Trump said Iran wanted to negotiate. That single statement eased the panic. OPEC+ also announced they'd increase production to keep prices stable. The market was reassured that this wouldn't spiral into a prolonged supply crisis.
The Treasury yield hit 5.2%. That's a big number. What does that mean for ordinary people?
It means the cost of borrowing is rising because investors are worried about inflation. If oil stays expensive because of the conflict, everything gets more expensive—gas, food, goods. That pushes up what the government has to pay to borrow money.
But inflation in Thailand actually fell in June.
It did, because oil prices had already started declining before this week's tensions. The government also cut fuel prices aggressively. Consumer confidence rose for the first time in months. People felt a little less squeezed.
What about the Microsoft layoffs and Meta's chip manufacturing? How do those fit?
They're part of the same story—tech companies are restructuring to compete in an AI-dominated future. Microsoft is cutting costs to focus on what matters. Meta is building its own chips to reduce dependence on suppliers and control its computing destiny. It's a sign of how seriously they're taking the AI race.
And the high-speed rail project falling apart?
That's the other side of the coin. Not everything moves forward. After six years of delays, lenders decided the project wasn't commercially viable anymore. The government has to start over or change the terms. It's a reminder that even with stimulus approval and foreign investment flowing in, execution is still hard.