Krungsri Securities forecast the Stock Exchange of Thailand (SET) Index on Wednesday (November 3) would fluctuate between 1,610 and 1,630 points.
It said negative sentiment of falling oil price and investors’ move to follow the outcome of Federal Open Market Committee (FOMC) and Opec+ meetings would pressure the index.
“However, mass buy-ups of SCB which gained its unique positive sentiment and shares whose third-quarter profit is expected to grow would help boost the index,” Krungsri Securities said.
It also recommended buying of the following companies’ shares as an investment strategy:
▪︎ SCB whose recently invested 17.8 billion baht to acquire 51 per cent shareholding in Bitkub.
▪︎ GULF, BGRIM, CHG, BCH, BDMS, KCE and JMT, whose third-quarter profit is expected to grow.
▪︎ AOT, AAV, BA, MINT, KBANK, SCB, CPN, CRC, HMPRO, CPALL, AMATA, WHA, MAJOR, BTS, BEM and VGI, which benefit from the country reopening.
The relentless rally in stocks pushed major U.S. benchmarks to their all-time highs just a day before the Federal Reserves policy decision.
Underpinning that strength is the fact that profit margins have held up incredibly well, despite soaring commodity prices and supply-chain snarls. Many companies have been able to pass through rising costs to consumers, with the majority beating earnings estimates. Regardless of what the Fed may say or do Wednesday, there’s a perception the U.S. will still have comparatively low rates, which bodes well for stocks.
“While the upside for equities might be slowing versus what we had seen over the course of the last 18 months, the reality is still that there’s a solid base for risk assets to continue to perform well,” Ian Lyngen, a strategist at BMO Capital Markets, told Bloomberg TV and Radio’s Surveillance on Tuesday.
Treasury two-year yields joined a global slide in short-term rates that was unleashed by the Australian central bank’s dovish statement just a day before the Fed decision. With U.S. policy makers expected to start scaling back their asset-purchase program soon, economists surveyed by Bloomberg are closely divided on whether a rate liftoff will be next year or early 2023.
“The Fed has managed expectations perfectly in terms of preparing the markets for what is likely to be speed tapering,” said Win Thin, global head of currency strategy at Brown Brothers Harriman. “Most officials seem to agree that it’s better to get tapering over as quickly as possible in order to leave the Fed maximum flexibility to hike rates when needed.”
Some corporate highlights:
–Tesla slipped as billionaire Elon Musk cast doubt on Hertz plan to buy 100,000 electric vehicles and downplayed the deal’s potential.
–Avis Budget Group soared amid a flurry of retail-crazed activity as the rental-car company said it will play a big role in the adoption of electric vehicles in the U.S.
–Pfizer climbed after boosting its forecast for the year on the strength of its Covid-19 vaccine sales. It also projected 2022 revenue for the shot above analysts’ expectations.
–Under Armour jumped as the athletic-gear maker raised its outlook and reported revenue that beat estimates.
After the recent rally in equities, technical indicators are signaling heightened volatility. Not only is the S&P 500 pushing the limits of its trading envelope — built around moving price averages — but the widening of its upper and lower bands can also be a precursor to greater swings. Furthermore, the gauge’s 14-day relative strength index is around 70, which is seen by some traders as a threshold for being considered overbought.
Here are some events to watch this week:
–Fed rate decision, U.S. factory orders and durable goods, Wednesday
–OPEC+ meeting on output, Thursday
–Bank of England rate decision, Thursday
–U.S. trade, initial jobless claims, Thursday
–U.S. unemployment, nonfarm payrolls, Friday
Some of the main moves in markets:
Stocks
–The S&P 500 rose 0.4% as of 4 p.m. New York time
–The Nasdaq 100 rose 0.4%
–The Dow Jones Industrial Average rose 0.4%
–The MSCI World index rose 0.1%
Currencies
–The Bloomberg Dollar Spot Index rose 0.2%
–The euro fell 0.2% to $1.1582
–The British pound fell 0.4% to $1.3616
–The Japanese yen was little changed at 113.95 per dollar
Bonds
–The yield on 10-year Treasuries declined two basis points to 1.54%
–Germany’s 10-year yield declined six basis points to -0.16%
–Britain’s 10-year yield declined two basis points to 1.04%
Commodities
–West Texas Intermediate crude fell 0.6% to $83.53 a barrel
Singapore is seeking to cement itself as a key player for cryptocurrency-related businesses as financial centers around the world grapple with approaches to handle one of the fastest growing areas of finance.
“We think the best approach is not to clamp down or ban these things,” said Ravi Menon, managing director of the Monetary Authority of Singapore, which regulates banks and financial firms.
Instead, MAS is putting in place “strong regulation,” so firms that meet its requirements and address the multitude of risks can operate, he said in an interview.
Nations differ vastly when it comes to how they handle crypto: China has cracked down on large amounts of activity in recent months, Japan only recently allowed dedicated crypto investment funds — though El Salvador has embraced bitcoin as legal tender. In the U.S., while there are an abundance of options for investing in the burgeoning asset class, regulators are concerned about everything from stablecoins to yield-generating products.
“With crypto-based activities, it is basically an investment in a prospective future, the shape of which is not clear at this point,” said Menon, who has helmed the MAS for about a decade. “But not to get into this game, I think risks Singapore being left behind. Getting early into that game means we can have a head start, and better understand its potential benefits as well as its risks.”
The stakes are high for the small island nation, which has already earned a reputation as a global wealth hub. Singapore must raise its safeguards to counter risks including illicit flows, Menon said.
The city state is “interested in developing crypto technology, understanding blockchain, smart contracts and preparing ourselves for a Web 3.0 world,” he said, referring to the third generation of online services, which will be a key theme during the Singapore Fintech Festival that MAS will host next week.
Menon acknowledged that banks and other financial institutions will face certain challenges with the decentralization of finance. Still, Singapore wants to be “well positioned” for 2030 when “an economy of tokenization” may come, he said.
Singapore isn’t the only place with crypto ambitions. Locations as diverse as Dubai, Miami, El Salvador, Malta and Zug in Switzerland, are also making efforts. It can be a fine line to tread, given the crypto industry grew up with few regulations, so many players balk at government officials’ attempts to impose guardrails.
Singapore’s approach has attracted crypto firms from Binance Holdings, which has had a series of run-ins with regulators around the world, to Gemini, a U.S. operator targeting institutional investors, to set up base. Some 170 companies applied for a MAS license, taking the total number of firms seeking to operate under its Payment Services Act to about 400, after the law came into effect in January 2020.
Since then, only three crypto firms have received the much-coveted licenses, while two were rejected. About 30 withdrew their application after engaging with the regulator. Among those approved is the brokerage arm of DBS Group Holdings Ltd., Singapore’s largest bank, which is also a pioneer in setting up a platform for trading of digital tokens while offering tokenization services.
The regulator is taking time to assess applicants to ensure that they meet its high requirements, Menon said. The MAS has also boosted resources to cope with high volumes of prospective services operators, he said.
“We don’t need 160 of them to set up shop here. Half of them can do so, but with very high standards, that I think is a better outcome,” he said.
Menon said the benefits of having a well-regulated local crypto industry could also extend beyond the financial sector.
“If and when a crypto economy takes off in a way, we want to be one of the leading players,” he said. “It could help create jobs, create value-add, and I think more than the financial sector, the other sectors of the economy will potentially gain.”
The Stock Exchange of Thailand (SET) Index closed at 1,617.89 on Tuesday, up 4.11 points or 0.25 per cent. Transactions totalled 76.90 billion baht with an index high of 1,621.69 and a low of 1,608.64.
The index rebounded slightly after falling for four consecutive days. The index dropped by 9.65 points or 0.59 per cent on Monday.
In the morning session, Krungsri Securities forecast the SET Index on Tuesday would fluctuate between 1,600 and 1,625 points due to lack of positive sentiment and slowdown in fund flow.
It said investors were waiting for the outcome of the Federal Open Market Committee (FOMC) and Opec+ due to the expectation that FOMC would taper its quantitative easing programme, while Opec+ would raise oil production capacity by 400,000 barrels per day in December.
“Hence, we advise investors using selective buy strategy as always,” Krungsri Securities said.
The 10 stocks with the highest trade value today were SCB, KBANK, KCE, BANPU, SCC, BBL, PTT, HANA, DELTA and ADVANC.
Other Asian indices were down with one exception:
Japan’s Nikkei Index closed at 29,520.90, down 126.18 points or 0.43 per cent.
China’s Shanghai SE Composite closed at 3,505.63, down 38.85 points or 1.10 per cent., while the Shenzhen SE Component closed at 14,377.27, down 99.26 points or 0.69 per cent.
Hong Kong’s Hang Seng Index closed at 25,099.67, down 54.65 points or 0.22 per cent.
South Korea’s KOSPI Index closed at 3,013.49, up 34.55 points or 1.16 per cent.
Taiwan’s TAIEX Index closed at 17,065.97, down 2.27 points or 0.013 per cent.
The daily consumption of fuel in Thailand during the first nine months of this year dropped by 5.2 per cent compared to the same period last year. The Department of Energy Business put this down to a decline in economic activities due to the Covid-19 crisis.
Nantika Thangsupanich, the department’s director-general, said on Monday that the daily consumption of Jet A1, benzene, diesel, kerosene and natural gas vehicle (NGV) fuels has dropped by 45.8 per cent, 8.9 per cent, 6.1 per cent, 2.3 per cent and 19.5 per cent year on year, respectively.
“The daily consumption of fuel oil and liquefied petroleum gas [LPG] has, however, risen by 14.1 per cent and 9.5 per cent, respectively,” she said.
Meanwhile, she added that the consumption of benzene and Jet A1 fuel rose by 11.1 per cent and 17.4 per cent respectively in September compared to August due to the easing of lockdown measures in 29 “dark red” zones.
She went on to say that Thailand imported 35,775 barrels per day of different fuel (benzene, diesel, fuel oil, jet fuel and LPG) in the first nine months of the year, marking a 17.2 per cent drop year on year. However, the value of imports stood at 2.24 billion baht per month, up 19.8 per cent due to the rising global oil price.
“Meanwhile, export of fuel in the first nine months stood at 195,666 barrels per day, up 2.1 per cent year on year. The export value accounted for 13.45 billion baht per month, up 58.2 per cent,” she added.
The Thai Chamber of Commerce (TCC) has warned Thais to be ready for a jump in prices in line with the surge in crude oil prices across the world.
TCC chairman Sanan Angubolkul said on Monday that the price of oil is not likely to drop to US$20-$30 per barrel until at least the first half of 2022, especially since the price has gone beyond the $80 mark and may even rise further. He said this spike can push up the cost of raw materials and other goods.
Sanan also said it will be difficult for the price of commodity goods to drop later.
Meanwhile, Suphan Mongkolsuthree, chairman of the Federation of Thai Industries, said the jump in oil prices is very concerning, pointing out that many economies have collapsed due to this surge. However, he said, Thailand is lucky because its economy is starting to pick up.
Suphan said the government should check how much Oil Fuel Fund it has and whether it should be increased. Thailand should also work towards improving the economy, so logistics operators can improve their income. He also said the long-term solution would be to reduce the use of fossil fuel and build up renewable energy.
Spiking oil price will push up food, household bills, warns Thai Chamber of Commerce
Spiking oil price will push up food, household bills, warns Thai Chamber of CommerceSpiking oil price will push up food, household bills, warns Thai Chamber of Commerce
Commerce Minister Jurin Laksanawisit met Chinese Ambassador Han Zhiqiang on Monday to discuss the expansion of bilateral trade and investment.
At the meeting, Jurin asked China to reopen two key checkpoints, namely Mohan and Guan Lei, that had been closed due to the Covid-19 pandemic.
“We asked the ambassador to help Thailand import fruit through the Guan Lei checkpoint and also to have relevant state officials check local chicken and birds nest factories to see if we can boost our export of these products,” he said.
“We also asked the envoy to urge COFCO, a rice-import corporation in China, to speed up the import of the remaining 280,000 tonnes of rice in line with the Thailand-China memorandum of understanding,” Jurin said.
Also on the agenda were other topics, such as the Sino-Thai Joint Trade Committee meeting, the Regional Comprehensive Economic Partnership (RCEP) and high-speed railway.
In the first nine months of this year, the value of Thailand-China trade stood at US$76.69 billion, up by 31.61 per cent compared to the same period last year.
The baht opened at 33.31 to the US dollar on Tuesday, strengthening from Monday’s closing rate of 33.35.
The Thai currency is likely to move between 33.20 and 33.40 during the day, Krungthai Bank market strategist Poon Panichpibool predicted.
Poon said that the baht might strengthen slightly due to the dollar weakening and gold selling. Investors might be waiting to sell the gold when the price goes up nearly 1,800 dollars per ounce.
However, the baht might fluctuate as foreign investors slow down in investing in Thai especially stocks. They will wait to see a clear picture of economic recovery after the country opening.
Moreover, foreign investors have alternative choices in investing in Asia and Southeast Asia such as Japanese and Vietnamese stocks.
The key resistance level for the baht would be from 33.40 to 33.50 to the dollar, which is the level at which exporters might sell the US currency.
Krungsri Securities forecast the Stock Exchange of Thailand (SET) Index on Tuesday (November 2) would fluctuate between 1,600 and 1,625 points due to lack of positive sentiment and slowdown in fund flow.
It said investors were waiting for the outcome of the Federal Open Market Committee (FOMC) and Opec+ due to the expectation that FOMC would taper its quantitative easing programme, while Opec+ would raise oil production capacity by 400,000 barrels per day in December.
“Hence, we advise investors using selective buy strategy as always,” Krungsri Securities said.
It also recommended buying of the following companies’ shares as an investment strategy:
▪︎ GULF, BGRIM, CHG, BCH, BDMS, KCE and JMT, whose third-quarter profit is expected to grow.
▪︎ AOT, AAV, BA, MINT, KBANK, SCB, CPN, CRC, HMPRO, CPALL, AMATA, WHA, MAJOR, BTS, BEM and VGI, which benefit from the country reopening.
The price of gold rose by THB50 in morning trade on Tuesday.
A9.27am report from the Gold Traders Association showed the buying price of gold bar at THB28,150 per baht weight and selling price at THB28,250, while the buying and selling price of gold ornaments is THB27,636.68 and THB28,750, respectively.
At close on Monday, the buying price of 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 Tuesday morning was hovering around US$1,791 (THB59,711) per ounce after Comex gold at close on Monday rose by $11.9 to $1,795.8 per ounce due to pressure from the appreciation of the US dollar, including the purchase of gold as a safe-haven asset after the US released weak economic data especially the manufacturing index which fell to its lowest level in 10 months.
Spiking oil price will push up food, household bills, warns Thai Chamber of Commerce
Spiking oil price will push up food, household bills, warns Thai Chamber of Commerce
Spiking oil price will push up food, household bills, warns Thai Chamber of Commerce
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