Thai shares are heading towards a bear market after falling by 4.73% Monday in the deepening global equities rout.
There are major concerns over an imminent US interest rate hike and the Chinese-led economic slowdown fuelled a continuing exodus from risky assets.
Securities analysts warn the correction could continue and the main gauge could slip below 1,300 points.
The Stock Exchange of Thailand (SET) index started the day on a sour note, while the selling spree intensified in late trade before the market closed at the day's trough of 1,301.06 points after a 64.55-point fall in heavy trade worth 60.5 billion baht.
The tumble took this year's slump to 19.7% from a high of 1,619.77 points on Feb 4. A bear market occurs when stock prices fall by more than 20%.
Blue-chip companies led by energy and petroleum stocks were at the centre of the selling pressure after oil prices fell by more than 4% to a six-and-a-half-year low.
National oil and gas firm PTT plunged 9.43% to 240 baht, Siam Cement (SCC) tumbled 6.3% to 476 baht, PTT Global Chemical (PTTGC) sank 6.64% to 49.25 baht, Airports of Thailand (AOT) dipped 4.15% to 254 baht, and Kasikornbank (KBANK) slid 5.22% to 163.50 baht.
Foreign investors yanked 4.78 billion baht out of the Thai market Monday, raising their net sales to 76.1 baht billion this year.
The Shanghai Composite index led Monday's rout, plummeting 8.46%, while the Philippines' PSE Composite index shed 6.7%, the Bombay Sensitive 30 index dived 6.11%, the Hang Seng index plunged 5.17%, and other Asian bourses dipped 2-4%.
The sell-off also weakened the baht to 35.75/35.77 to the US dollar from last Friday's 35.63/35.65.
Newly appointed Finance Minister Apisak Tantivorawong blamed the sharp fall in the Thai stock market on external factors.
"This is an era of globalisation, and the impact does not emerge in the Thai stock market alone," he said, adding that stimulus measures to be introduced by new economic ministers should improve sentiment.
Bank of Thailand spokesman Chirathep Senivongs Na Ayudhya said the correction in the stock market could be foreseen, as it was in accordance with that of global markets.
"Assessment of the overall effect on the economy has to be cautious regarding short- and long-term impacts," he said.
"Too much weight should not be put on a single factor, especially how the stock market adjustment is sensitive towards short-term volatility."
Tisco Securities chief executive Paiboon Nalinthrangkurn said three key factors jolting Thai shares were Wall Street's sharp fall, worries over China's cooling economy and tumbling commodities prices.
Investors were concerned China's slowdown will also dent growth of export-dependent countries, he said.
"Thailand's economy remains strong, but its growth is still tepid. New economic ministers bring new hope. If they can push infrastructure projects and accelerate government spending, consumption will be boosted eventually," Mr Paiboon said.
Mayuree Chowvikran, a senior analyst at Maybank Kim Eng Securities (Thailand), said panic sales of energy, petrochemical, banking and property stocks were seen globally and added: "Investors should wait and see."
Therdsak Thaveeteeratham, an executive vice-president of Asia Plus Securities, said the SET index might fall to between 1,280 and 1,290 points, and there were no signs of capital inflows to reverse it.
AFP reports from London
Global stock markets plunged and commodity prices hit new lows Monday extending a Chinese-led rout, fed by fears of a damaging slowdown in the world's second-largest economy.
Chinese stocks have tumbled since peaking in mid-June and authorities have launched broad interventions to try to restrain the drops, but Beijing's latest market intervention has failed to restore confidence.
Several European markets sank more than 7% in afternoon trades, while US stocks tumbled at the open with the Dow dropping more than 3%.
China-linked shares again led the stocks sell-off, with Shanghai closing down 8.49%, the biggest daily loss since February 27, 2007.
"The fog of fear over the state of the Chinese economy is only thickening, and with little in the way of non-Chinese news to come this Monday, the markets are going to struggle to escape today without some fairly ugly scars," said Connor Campbell, a Spreadex financial analyst.
Falling oil prices also weighed on market sentiment as they slid below $40 a barrel for the first time since 2009, after weak Chinese manufacturing data deepened fears that the Asian giant is growing more slowly than thought.
Global equities have lost more than $5 trillion since China's shock currency devaluation on August 11.
At mid-afternoon, Frankfurt's blue-chip DAX 30 index was down 6.79% at 9,537.91 points, while the CAC 40 in Paris trading dropped 6.57% to 4,329.12 after earlier sinking more than 8%
London's benchmark FTSE 100 index of leading companies lost 5.02% to stand at 5,877.01 compared with Friday's close.
"Things are probably going to get worse before they get better," Nader Naeimi, head of dynamic asset allocation at AMP Capital Investors in Sydney, told Bloomberg News.
"You really need rate cuts and more policy easing in China. In the meantime, things can get worse."
About 15 minutes into trade on Wall Street, the Dow Jones Industrial Average lost 3.30% - a more than 1,000 point drop from the opening level - before recovering somewhat.
The broad-based S&P 500 sank 3.18%, while the tech-rich Nasdaq Composite Index fell 3.84% to 4,525.38.
"We're following the situation in China very closely. However, the concrete fallout for the German economy is likely to be limited," a government spokesman for Europe's biggest economy told reporters in Berlin.
Other European markets that dropped more than 5% by mid-afternoon included Amsterdam, Brussels, Milan and Madrid. Oslo's commodities heavy index nosedived more than 7%.
Crisis-hit Greece's main stock market plummeted more than 11% on Monday, succumbing to a Chinese-led sell-off and also domestic political uncertainty ahead of likely elections next month.
The euro meanwhile strengthened to $1.1599 from $1.1386 on Friday.
Russia's ruble also hit a new 2015 low and stocks sank, battered by falling oil prices and the impact of sanctions over Ukraine.
Data on Friday showing Chinese manufacturing activity slowed to a 77-month low had added to the gloom, signalling that even a campaign by Beijing with its vast arsenal of reserves has not been able to stimulate growth.
In other top Asian markets, Hong Kong's benchmark fell 5.17%, Tokyo 4.61%, and Sydney lost 4.09%.
More than 800 stocks listed in Shanghai fell by their maximum 10% daily limit, among them many of the brokerages that spurred a year-long rally that saw shares soar 150% before they collapsed in June.
Chinese authorities have since launched unprecedented measures to support stocks. On Sunday state media said the huge national pension fund would now be allowed to buy equities, in a fresh bid to prop up the market.
The fund, which had some 3.5 trillion yuan ($550 billion) in net assets at the end of 2014, will be able to invest up to 30% of that in equities.
But local investors fear even Beijing's huge firepower will not be enough to stop the rout in Chinese shares, particularly after the benchmark Shanghai index fell through the key 3,500 point mark.
"This is a real disaster and it seems nothing can stop it," Chen Gang, Shanghai-based chief investment officer at Heqitongyi Asset Management Co, told Bloomberg News.
"If we don't cut holdings ourselves, the fund (managed by his firm) faces risk of forced closure. Many newly started private funds suffered that recently. I hope we can survive."
Oil prices also tumbled, accelerating losses after breaking below the $40 barrel for the first time in six years Friday on concerns about waning demand in China, the world's top energy importer.
Data showing the number of US drilling rigs rose last week, despite the slump in prices, added to concerns a global supply glut will last for years.
US benchmark West Texas Intermediate (WTI) for October delivery tumbled to $38.69, striking a level last seen in February 2009.
Brent North Sea crude for October dived in morning London deals to $43.28, last seen in mid-March of the same year.
Traders also dropped the dollar and moved into the yen - a safe haven in times of turmoil and uncertainty - while the currencies of Malaysia, Thailand and South Korea all hit new multi-year lows.
The greenback fell to 119.82 yen on Monday from 122.06 yen in New York Friday.
