Oct. 29--Relevant agencies should be proactive in clarifying spurious rumours that may affect the capital market, said Patareeya Benjapolchai, the president of the Stock Exchange of Thailand.

She said the SET favoured creating a mechanism where relevant agencies joined hands in disseminating information if the market is affected by rumours leading to market panic.

Representatives of the SET, the Securities and Exchange Commission, the Bank of Thailand and the Finance Ministry will meet with Finance Minister Korn Chatikavanij on Monday to discuss how best to grapple with instances of market panic.

The SET index fell by more than 7 percent in two days earlier this month amid concerns over the health of His Majesty the King, who has been hospitalised for the past several weeks and is receiving treatment for a lung infection. Share prices later recovered after the Royal Household Bureau announced that His Majesty was responding well to therapy.

Securities regulators and the police have launched an investigation into whether any parties intentionally sought to manipulate the share market.

"Relevant agencies should unite to explain what happens," she said.

Mrs Patareeya said several details would still have to be discussed, including how long authorities should wait before responding with an official clarification.

She added that the market's existing "circuit-breaker" system was sufficient for protecting the capital market in the event of panic sales. The SET will automatically halt trade for 30 minutes if the main index falls by more than 10 percent from the previous day's close, and extend the suspension to one hour if after trading resumes the index falls by more than 20 percent from the previous day's close.

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