The Stock Exchange of Thailand (SET) Index closed at 1,649.82 on Wednesday, up 3.40 points or 0.21 per cent. Transactions totalled 86.13 billion baht with an index high of 1,658.60 and a low of 1,647.90.
The index rises after falling by 3.12 points or 0.19 per cent on Tuesday, thanks to the rise in oil price in response to an expectation that Opec+ would suspend its oil output hike plan to deal with several countries’ move to release their oil reserves.
The 10 stocks with the highest trade value today were BANPU, ADVANC, TRUE, KBANK, AOT, EA, PTT, CPALL, DTAC and GUNKUL.
Other Asian indices were mixed:
Japan’s Nikkei Index closed at 29,302.66, down 471.45 points or 1.58 per cent.
China’s Shanghai SE Composite closed at 3,592.70, up 3.61 points or 0.10 per cent, while the Shenzhen SE Component closed at 14,887.60, down 17.54 points or 0.12 per cent.
Hong Kong’s Hang Seng Index closed at 24,685.50, up 33.92 points or 0.14 per cent.
South Korea’s KOSPI Index closed at 2,994.29, down 3.04 points or 0.10 per cent.
Taiwan’s TAIEX Index closed at 17,642.52, down 23.60 points or 0.13 per cent.
Prime Minister Prayut Chan-o-cha is satisfied with the improvement in foreign investments this year, government spokesperson Thanakorn Wangboonkongchana said on Wednesday.
Thanakorn cited a Department of Business Development report, saying that 213 foreigners, who were given permission to operate businesses in Thailand, invested more than THB11.55 billion from January to October this year, resulting in employment for over 5,000 Thais.
The top three foreign investors in Thailand were Japan (82), Singapore (33) and Hong Kong (20), he said.
“Most of the businesses that have been allowed to operate in Thailand are related to several government projects, such as the high-speed rail, smart warehouse and distribution centres and digital insurance platforms,” he said.
Thanakorn also cited a Board of Investment report, saying that business operators requested investment support for 564 projects related to the Bio-Circular-Green (BCG) economy from January to September, up 74 per cent year on year.
The investment value in the first nine months totalled THB128.37, higher than last year’s THB93.88 billion, he said.
“From 2015 to September this year, there were 2,829 projects related to the BCG economy worth THB677.15 billion,” Thanakorn said.
“The top three projects with high investment value were renewable electricity generation (THB289 billion), modern food and beverage manufacturing and preservation (THB94.22 billion) and eco-friendly chemical or polymer manufacturing (THB40.99 billion).”
Thanakorn expected more foreign investors to operate businesses in Thailand in the latter part of the year as the government had launched measures to facilitate investment and stimulate the economy.
“The BCG model will enable Thailand to develop an eco-friendly economy in line with the United Nation’s Sustainable Development Goals,” he said.
“We expect that in the next five years the value of the Thai BCG industry will account for 25 per cent of gross domestic product, resulting in balanced and sustainable economic growth,” Thanakorn added.
Five non-Asean members – China, South Korea, Japan, New Zealand and Australia – will do away with import tariffs on some products from Thailand and other Asean countries once the Regional Comprehensive Economic Partnership (RCEP) comes into effect on January 1, Department of Trade Negotiations director-general Auramon Supthaweethum said on Tuesday.
The RCEP is a free-trade agreement (FTA) among 15 Asia-Pacific countries – Thailand, Australia, Brunei, Cambodia, China, Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, South Korea and Vietnam.
It will be Thailand’s 14th FTA with other countries.
With 15 members and a market of 2.3 billion people, or 30 per cent of the global population, the RCEP is seen as the largest current FTA. Member states account for a whopping 33.6 per cent, or a third, of the world’s GDP and a third of global trade.
RCEP members to eliminate import tariffs on a host of Thailand-made goods
Auramon said Thailand, too, would eliminate import tariffs on more than 29,000 products for RCEP members.
She explained that Thailand would receive import tariff exemptions from five non-Asean countries as follows:
RCEP members to eliminate import tariffs on a host of Thailand-made goods
> China: 67.3 per cent of all products will be exempted from import duties, such as industrial products, optical components, wood, telephone components, computer parts, electrical components, petroleum products and polypropylene beads.
> South Korea: 61.5 per cent of all products will be exempted from import duties, such as petroleum products, washing machines, refrigerators, motorcycle components, photography equipment, signal transmission equipment, audio recording equipment parts, fuses, electric transformers, cotton and synthetic fabrics and sugar.
RCEP members to eliminate import tariffs on a host of Thailand-made goods
> Japan: 73 per cent of all products will be exempted from import duties, such as telephones, computer components, integrated circuits, printers, air-conditioners, cameras, video recorders, signal transmission equipment, aluminium doors and windows, electric wires, smoked rubber sheets and pet food.
> New Zealand: 64.6 per cent of all products will be exempted from import duties, such as car wheels, canned tuna, pet food, petroleum products, shampoo, vulcanised rubber, clothes and accessories, internal combustion engine parts, accumulators, wires, cables and wooden chairs.
RCEP members to eliminate import tariffs on a host of Thailand-made goods
> Australia: 75.3 per cent of all products will be exempted from import duties, such as air-conditioner components, canned tuna, refrigerators, washing machines, precious-metal accessories, car wheels, plastic bags, flavoured food, optical equipment, cosmetics, soaps, shampoos and juices.
The Cabinet on Tuesday approved an amendment to a Finance Ministry regulation relating to the foreign currency-exchange business under the Exchange Control Act.
“The amendment aims to increase the efficiency of the foreign currency-exchange business and convenience for customers,” said deputy government spokesperson Ratchada Thanadirek She said it would cover six aspects:
1. Licensed foreign currency-exchange businesses will be allowed to exchange currencies in other forms apart from banknotes, such as credit or debit cards issued by foreign banks. This means foreigners can now purchase the baht using their credit or debit cards.
2. New foreign currency-exchange business operators can register with the Bank of Thailand. In the past they had to obtain a licence issued only by the finance minister.
3. The obtained licence can now be shared between the head office and other branches of the business, while in the past businesses having several branches had to apply for a licence for each branch on a one-to-one licensing basis.
4. The business will be allowed to use revenue from foreign currency exchange for purposes other than selling to or depositing with a commercial bank, such as settling trade debts or selling to a third party.
5. Applicants seeking a licence for a treasury centre business must be a juristic person, while existing businesses registered by an individual will be able to use their licence for three years from the date this ministerial regulation takes effect.
6. Directors and major shareholders of foreign currency-exchange businesses must never have been jailed or sentenced to a jail term in offences relating to foreign currency exchange. This is to ensure the regulation complies with international anti-money laundering standards.
The baht opened at 33.14 to the US dollar on Wednesday, weakening from Tuesday’s closing rate of 33.11.
The Thai currency is likely to move between 33.00 and 33.20 to the greenback during the day, Krungthai Bank market strategist Poon Panichpibool predicted.
Poon said that the baht might fluctuate as foreign investors decreased their possession of baht while the moving average convergence divergence signalled that the baht is weakening.
Meanwhile, the gold price that was decreasing and dropped to the key support level of 1,780 to 1,800 dollars per ounce affected the baht heavily. Some investors are buying on dips caused the baht to weaken.
However, the baht will not weaken much because exporters are selling the dollar which caused the key support level of baht to be from 33.20 to 33.30 to the dollar.
The price of gold rose by THB50 in morning trade on Wednesday.
AGold Traders Association report at 9.28am said the buying price of a gold bar was THB28,150 per baht weight and selling price THB28,250, while the buying and selling price of gold ornaments is THB27,636.68 and THB28,750, respectively.
At close on Tuesday, the buying price of a gold bar was THB28,100 per baht weight and selling price THB28,200, while gold ornaments were THB27,591.20 and THB28,700, respectively.
The spot gold price on Wednesday morning hovered around US$1,793 (THB59,680) per ounce after Comex gold at close on Tuesday dropped continuously by $22.5, broke down psychologically significant level around $1,800, to $1,783.8 per ounce due to pressure from the rise in US government bond yields, including concerns that Jerome Powell’s second term as Federal Reserve Chair (Fed) will make the Fed likely to raise interest rates next year.
Krungsri Securities forecast the Stock Exchange of Thailand (SET) Index on Wednesday (November 24) would fluctuate between 1,635-1,655 points.
It said the index gained positive sentiment from rising oil price on the expectation that Opec+ would suspend its oil output hike plan to deal with several countries’ move to release their oil reserves.
“However, uncertainty over fresh Covid-19 wave in Europe, the fall in US Purchasing Managers Index and inflation crisis would cause fund flow volatility, resulting in pressure on index,” Krungsri Securities said.
It also recommended buying of the following companies’ shares as an investment strategy:
▪︎ HANA, KCE, TU, ASIAN, NER, EPG and XO, which benefit from the weakening baht.
▪︎ BBL, TTB, KTB, KBANK and BLA, which would benefit from the rising interest rate.
▪︎ BGRIM, GPSC and GULF, which will benefit from rising electricity tariff rate between January and April next year.
As of 10.20am, the SET Index rose by 7.15 points or 0.43 per cent to 1,653.57, witnessing a high of 1,655.49 and a low of 1,649.92 in opening trade.
China pulled back on its already halting progress toward meeting its U.S. trade deal targets, slowing purchases of all types of goods covered by the agreement despite calls from the Biden administration for Beijing to adhere to its commitments.
China bought $9.5 billion worth of manufactured, agricultural and energy goods in October, bringing the total purchases to $210.4 billion since the trade deal was signed in January 2020, according to Bloomberg analysis of official Chinese data. Last month’s procurement was the slowest pace in a year, with China now having reached only 56% of the two-year target of $378.4 billion.
U.S. officials have recently increased their calls for China to abide by the agreement, though it’s unknown what steps it would take in response to Beijing failing to meet its goals. The trade targets expire at the end of next month, although it includes a sentence that both sides expect the increase in purchases to continue in “2022 through 2025.”
U.S. Commerce Secretary Gina Raimondo said in September that China isn’t abiding by its commitments and pointed to Beijing preventing the purchase of “tens of billions of dollars” of Boeing planes. U.S. Trade Representative Katherine Tai said last month that the administration would work to enforce China’s commitments in the trade deal.
Tai acknowledged earlier this month that China’s performance “hasn’t been perfect” and officials are working on their next steps.
“So what do we do about it? That’s the million-dollar question,” she said, adding “it’s something we’re working on.”
Tai also said the U.S. is raising concerns with Beijing that go beyond its promised purchases, including about China’s state-centered industrial policies, leaving the future of the trade deal unclear.
A summit last week between Presidents Joe Biden and Xi Jinping didn’t provide much clarity on trade either. U.S. officials said the topic of trade and restrictions on technology exports didn’t dominate the conversation. China reiterated calls for the White House to avoid both “over-stretching” the concept of national security in business dealings and politicizing trade issues.
The U.S. will release 50 million barrels of crude from its strategic reserves in concert with China, Japan, India, South Korea and the U.K. — an unprecedented, coordinated attempt by the worlds largest oil consumers to tame prices that risks a backlash by OPEC+.
But the oil market was initially underwhelmed by the details of the package — much of the oil will need to be returned to the stockpile by the refiners who buy it, and international contributions were smaller than many expected. After an initial dip in prices, oil gained more than a $1 a barrel.
The response of OPEC+ will be key to the eventual success or failure of the plan. Officials from the Saudi-led group, which meets to set policy next week, have warned they’re likely to respond by canceling plans to boost their own production, negating the addition of stockpiled oil onto the market.
At stake is the price of the world’s most important commodity as President Joe Biden contends with the strongest inflation in more than a decade, a surge that’s hitting his approval ratings and risks undermining the post-Covid economic recovery. The administration said on Tuesday it had other tools at it’s disposal to bring down energy prices if need be.
Of the 50 million barrels , 32 million will be issued from the U.S. Strategic Petroleum Reserve as an exchange over the next several months, while 18 million will come from an accelerated release from previously authorized sales, the White House said in a statement Tuesday. It represents one of the biggest drawdowns ever from the reserve, surpassing U.S. interventions amid Libyan unrest in 2011 and Operation Desert Storm in 1991.
A senior administration official told reporters Tuesday that barrels would begin moving as soon as mid-to-late December.
West Texas Intermediate futures rose $1.01 to $77.76 a barrel at 9:22 a.m. in New York as the volume of crude released was less than the market expected. Oil prices have fallen sharply in the week since the President Biden’s administration began discussing a release of crude from the reserve.
Biden’s decision to collectively discharge stockpiled crude after OPEC+ countries rebuffed calls to significantly boost production marks a diplomatic win for the U.S. and a challenge to the grip that Saudi Arabia, Russia and other OPEC+ producers have on the market.
“The market focus has shifted from the release to how OPEC+ will respond to what the White House is calling a ‘message to the Saudis’,” said Bob McNally, president of consultant Rapidan Energy Group and a former White House official under President George W. Bush. “If it comes to a test of wills and capabilities between a handful of strategic oil reserve holders led by the U.S. and OPEC+, the market would probably bet on the latter prevailing.”
Under the plan, the U.S. will conduct the exchanges over several months, with oil companies taking possession of the crude now and then returning supplies to the reserve later, when prices have eased.
Senior administration officials said the two-pronged oil release plan, the result of months of discussion and diplomacy, is tailored to the current market conditions, with oil prices that are high now expected to dip in coming months.
The administration can also make adjustments to the exchanges in coming months as it deals with a dynamic oil market, the administration official said.
The administration has worked to identify the best tools for addressing the current dynamic, one of the officials said. It has so far rebuffed calls from members of Biden’s own party to clamp down on exports of U.S. oil, amid warnings that could backfire by actually discouraging domestic production.
Biden, who is scheduled to deliver remarks on the economy and consumer prices later Tuesday, has been seeking the joint release for weeks, including during a virtual summit with Chinese President Xi Jinping. Ultimately, China was among the countries that agreed to the move. Previous global efforts to tap stockpiles — such as the 2011 release of 60 million barrels in the wake of unrest and supply disruptions in Libya — were coordinated by the International Energy Agency.
“Tapping the SPR will provide much-needed temporary relief at the pump and will signal to OPEC that they cannot recklessly manipulate supply to artificially inflate gas prices,” Senate Majority Leader Chuck Schumer said in a statement.
Asian countries joined the U.S. releasing oil, sending a political signal of support, but one with little oil market value as the quantities involved were small, disappointing traders.
India said it will release 5 million barrels, according to a statement. China didn’t disclose its contribution, but one Western official familiar with the matter said it would be relatively small, in the 7 million-to-15 million barrels range. South Korea said it will decide on details such as volume and timing after discussing with partner countries but indicated it could be about 3.5 million barrels. Japan indicated it would release 5 million barrels or less. The U.K. contribution is expected to be even smaller, the same official said.
“This is a hugely political move, and the Asian countries are adding only small, largely symbolic amounts,” said Amrita Sen, co-founder of consultant Energy Aspects Ltd. in London.
Biden has been under increasing pressure to stem rising energy prices that threaten to undermine the economic recovery from the pandemic. OPEC+ earlier snubbed his request for a large production increase and instead raised output by just 400,000 barrels per day for December.
The national average price for a gallon of regular unleaded gasoline has been hovering around a seven-year high and was $3.403 as of Nov. 22, according to auto club AAA.
Rising motor fuel prices pose a political risk to any U.S. president. But Biden has added reason to worry, as high energy costs and rising inflation could hamper both the economic rebound from the pandemic and his ability to enact major social-spending legislation.
Business groups and Republican lawmakers said they opposed the move. Christopher Guith, senior vice president of the Chamber of Commerce’s Global Energy Institute, argued the reserve should only be tapped for true supply disruptions and said the Biden administration instead should focus on encouraging domestic oil production.
“America’s real strategic petroleum reserve is in places like the Permian Basin and the Gulf of Mexico,” Guith said in an emailed statement. “Instead of ineffectual Band-Aids, the White House should focus on policies that will encourage domestic production of oil and natural gas.”
The U.S. Strategic Petroleum Reserve, the world’s largest government stockpile, was established after the Arab oil embargo in the 1970s and has been tapped in response to Operation Desert Storm in 1991, Hurricane Katrina in 2005 and Libyan supply disruptions in 2011. It also has been used to bring down domestic gasoline prices, such as by President Bill Clinton weeks before the 2000 election, as well as to fund unrelated domestic legislation.
The reserve stood at 606.1 million barrels as of Nov. 12, enough to replace more than half a year’s worth of U.S. crude net imports. Current inventory is about 85% of its maximum authorized storage capacity, after withdrawals.
The Energy Department is already obligated by law to sell 260 million barrels of oil from the reserve by fiscal year 2027. Additional releases now could slightly lower prices, analysts say, though the effects would be temporary and could be muted by market expectations of a sale the Biden administration has spent weeks telegraphing.
The maximum draw-down capability is 4.4 million barrels a day, according to the Energy Department’s website, and it generally takes 13 days for oil from the reserve to reach the open market after a presidential decision. But the mere announcement that the reserve is being tapped could have an immediate, if short-lived, effect on oil prices.
The idea of wielding U.S. emergency oil stockpiles to blunt prices divides members of Biden’s own political party. House Majority Leader Steny Hoyer, a Democrat from Maryland, said Nov. 16 he was not in favor of the move and noted the SPR is meant to protect the U.S. from Middle East supply crunches.
U.S. refiners are currently exporting the most gasoline since 2018, before the pandemic started.
Under a 1975 law that established the reserve, a president can order a full draw down in the event of a “severe energy supply interruption” that threatens national security or the economy. A limited drawdown (up to 30 million barrels) can be ordered in the event of “a domestic or international energy supply shortage of significant scope or duration.”
A $12 billion liquefied natural gas investment approved in Australia leads a wave of projects betting demand will rise as the world shuns more polluting alternatives like coal.
The development of the Scarborough field, Pluto onshore processing facility and a 430-kilometer (267-mile) subsea pipeline led by Woodside Petroleum Ltd. will supply as much as 8 million tons annually for at least 20 years, with first cargoes expected from 2026.
It’s a project that cuts straight to a key debate in the energy transition: the role of natural gas as nations aim to both curb greenhouse gas emissions and avoid supply crunches that triggered recent power shortages in Asia and record prices in Europe.
“One of the quickest ways for nations to reduce their emissions is to switch their energy system from coal to gas-fired,” Woodside’s Chief Executive Officer Meg O’Neill said Tuesday in an interview with Bloomberg Television. “We think the market for LNG will be very robust for decades into the future.”
Climate campaigners estimate the project’s direct carbon dioxide emissions will be about 4.4 million tons a year and that figure swells to 56 million tons if the burning of the gas by consumers, or so-called scope 3 environmental impacts, are included, the Australia Institute think tank said in a June report.
“Gas is still needed,” and particularly in industrializing nations, said Henning Gloystein, global director of energy and natural resources at Eurasia Group. Yet sanctioning new spending on the fuel will also stoke debate over net zero commitments. “Investing into the future extraction of hydrocarbons certainly locks in future emissions,” he said.
Woodside, which aims to sell a stake in Scarborough and retain about a 50% interest, advanced 3.5% in Sydney trading Tuesday, as BHP Group gained 4%.
Australia’s LNG boom in the past decade saw companies from Chevron Corp. to Royal Dutch Shell pump about $200 billion into mega-projects that transformed the nation into a key exporter. Now there’s a rising challenge in the seaborne market from Qatar and the U.S.
Emerging projects include Cheniere Energy Inc.’s Stage 3 expansion of its Corpus Christi export plant in Texas, Venture Global LNG’s Plaquemines project in Louisiana, Qatar’s North Field South development and Novatek’s Arctic LNG-1 in Russia, according to Wood Mackenzie senior analyst Daniel Toleman.
“Woodside is not the only LNG player looking to take advantage of rising prices and strong demand,” Toleman said. “Over the next 12 months we expect several low-cost projects to move toward sanction.”
The outlook for natural gas will depend on how quickly national climate pledges are put into action. Consumption of natural gas would be about 25% higher by 2050 based on a continuation of existing policies, while demand would peak in 2025 and slowly decline if nations follow through on their promised commitments, according to the International Energy Agency.
Key LNG consumers including Japan and South Korea have already flagged they’ll need to curb imports in the decades ahead to meet targets to zero out emissions.
“Woodside is aggressively progressing the Scarborough project even while major trading partners such as Japan and Korea are taking active steps to decrease LNG demand, effectively ignoring stranded asset risk,” said Dan Gocher, a director at the Australasian Centre for Corporate Responsibility, a shareholder activist group.
BHP and Global Infrastructure Partners LP, which this month agreed to buy a 49% stake in the Pluto Train 2 part of the development, are backing the view that gas demand will remain firm as the world decarbonizes.
In a sharply criticized plan on how it’ll achieve net zero emissions, Australia’s government also endorsed that outlook, forecasting the nation’s earnings from gas exports will rise 13% by 2050. The new Woodside project is likely to continue into the 2050s and add at least A$125 billion ($90 billion) to gross domestic product, Australia’s Resources Minister Keith Pitt said Tuesday in a statement.
RCEP members to eliminate import tariffs on a host of Thailand-made goods
RCEP members to eliminate import tariffs on a host of Thailand-made goods
RCEP members to eliminate import tariffs on a host of Thailand-made goods
RCEP members to eliminate import tariffs on a host of Thailand-made goods
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