"Investors may be temporarily relieved that a semblance of normalcy has returned but the political risk remains high and investors will likely be cautious," said Warut Siwasariyanon, head of research at Finansia Syrus Securities in Bangkok.
"The big underlying conflict is still there and the wound is deeper than ever even as the roads have been wiped clean."
At least 54 people were killed in Bangkok and over 400 injured in the latest bout of violence which began on May 14. Almost 40 buildings were set on fire last week as the army dispersed thousands of anti-government protesters who had taken over the commercial heart of the city for months.
The planning agency said the 2010 growth forecast was being maintained at 3.5-4.5 percent, but had been dragged down 1.5 percentage points by the political crisis.
The economy grew a strong 3.8 percent on the quarter in the January-March period, against market expectations of 1.8 percent.
The stock market fell as much as 1.6 percent as trading resumed after five days.
However, Thai bond yields jumped as the market priced in a likely hike in interest rates in mid-year following the strong growth figures. In early deals, benchmark five-year bond yields surged 8 basis points to 3.20 percent.
"With the violence behind us, the central bank may start looking at raising rates now and that is being priced into the market," said one Bangkok-based trader.
Both metropolitan train services, the Skytrain and the underground, operated as normal after starting skeletal service over the weekend following disruptions during the protests.
Trains were crowded, but there was enough space to stand comfortably, even in morning rush hour.
"You look around and it feels like nothing has happened," said Dao Pipirom, a 35-year-old market researcher whose apartment is in the business district. "Life goes on as normal now."
"But I still get very agitated when I hear loud noise. I keep thinking it's another grenade blast or gunshot."
Government offices and some schools are also scheduled to reopen on Monday, but a night curfew in the city and 23 provinces was still being imposed.
CLEAN-UP
On Sunday, thousands of municipal workers and volunteers, including high school students, cleaned up the Rachaprasong district the anti-government red shirt protesters had occupied for months.
Armed with straw brooms, plastic gloves, garbage bags and face masks, some used kitchen scourers and razor knives to remove anti-government posters and graffiti. Others carted away rubbish left by the protesters.
The red shirts, mainly rural and urban poor, demand new elections, saying Prime Minister Abhisit Vejjajiva lacks a popular mandate and is propped up by the military and a Bangkok elite that has disenfranchised them.
Abhisit said in a regular Sunday broadcast that he did not wish to stay for his full term, which lasts until 2012, but did not confirm whether an earlier offer to the red shirts of a November election was still on the table.
The protesters had rejected that offer.
"It is now up to me to decide whether that election is appropriate... I don't know what is going to happen next as some people have vowed to continue their struggle, calling for the resumption of the protest in June," Abhisit said.
Red shirt leaders have said they will resume protests outside Bangkok next month, but the main anti-government Puea Thai party said it would bring a no-confidence motion against the government at a special session of parliament on Monday.
The government is likely to easily defeat the motion.
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