The coup in Thailand has made investors in Asia nervous, but market experts say the removal of Prime Minister Thaksin Shinawatra by the military probably will not damage the country's economy.

Thailand's financial markets were closed Wednesday, a day after the military seized control of the government. Stock markets in most of the rest of Asia slumped, however, in part because investors were worried about the political uncertainty in Bangkok.

The Thai baht fell about one percent Wednesday, to about 37.7 to the dollar, although there was no sign of panic selling of the currency. Many financial analysts say they do not expect it to fall much below 38 to the dollar.

Many analysts say they expect the coup removing Prime Minister Thaksin Shinawatra will have only a modest, and brief, effect on the Thai economy.

Overall, they say, Thailand's economy is strong and the key industries - manufacturing, agriculture and tourism - are not likely to bothered by the events in Bangkok. Both foreign and domestic investors appear to be reacting calmly to the coup.

Harry Bunyaraksh is the head of sales in Thailand for the investment bank C.L.S.A. He says he expects share prices to fall the first few days after the stock exchange reopens, but then quickly stabilize.

"I think initially the foreign investors could get spooked, but I think those that know Thailand very well will not be so worried - partly because there's been a string of coups in the past and the business community seems to go on as per normal," he said.

He and many other financial and political analysts say they expect the Thai military to move quickly to return the country to civilian rule. Bunyaraksh says the coup leaders were unhappy with what they considered "dirty elections" and Mr. Thaksin's divisive policies, and did not grab power to change economic policy or control public opinion.

"The military coup that happened last night has a well intention to restore free and fair elections within the next five to six months," he said.

The coup leaders in fact said elections would take place in one year, but assured the nation that they did not wish to hold onto power. However, if uncertainty drags on, or violence breaks out, the economic outlook could change.

The credit rating agencies Fitch and Standard and Poor's both put Thailand on a credit watch for a possible downgrade. A downgrade would mean there are fears the government and Thai companies might not be able to repay their debts, which could prompt many investors to sell off their holdings in the country.

It is that scenario that worries investors in Asia. In 1997, concerns about Thailand's foreign debt and the strength of its banking system contributed to a collapse of the baht. That cascaded across Asia, sending currencies and stock markets plunging, and set off the Asian economic crisis. Most countries fully recovered from the crisis only a few years ago.

By late Wednesday, most major Asian stock indexes were lower. Australia's All Ordinaries index and Japan's Nikkei 225 were both down about one percent. The Jakarta Composite was off .4 percent.

The market in Manila was the worst hit - down nearly two percent. Like Thailand, the Philippine government is seen as vulnerable to coups or other political uncertainty.

Hong Kong's Hang Seng Index was one of the Asian stock gauges to rise Wednesday. It was up nearly one percent, because investors here are hopeful the U.S. Federal Reserve will not raise interest rates in the coming days.