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https://www.nationthailand.com/business/40002332

Bitcoin slides, erasing nearly all 2021 gains, as China crackdown continues

Cryptocurrency investors got hammered Tuesday, with losses wiping out more than $100 billion in market value overnight and slashing most of bitcoins gains for the year.

The most popular and valuable token fell more than 9 percent before recovering somewhat in the afternoon, briefly sending the digital currency below $30,000, a significant psychological benchmark not seen since January. Though long-term holders are typically better suited to weather the volatility of the cryptocurrency, the prolonged slump has erased most of the astronomical gains built up this year. And those who purchased near bitcoin’s all-time high of $64,000 have seen their investments cut by more than half.

By late afternoon Eastern time, bitcoin was trading around $32,000, turning positive for the day.

The slide and rebound followed reports that China has ramped up its crackdown of bitcoin miners in the country, part of a continuation of Beijing’s antagonistic approach to cryptocurrency. To reduce energy consumption in support of their climate goals, Chinese authorities have sent miners scattering.

The networks on which digital currencies run require robust computing power to execute transactions and other purposes, such as generating a fresh supply of cryptocurrency. But those maneuvers require large amounts of energy, a long-standing concern of environmentalists and other critics.

Elon Musk, the chief executive of Tesla, said earlier this month that his all-electric vehicle company would return to accepting bitcoin as payment once it confirms that enough miners are using renewable energy to power their networks.

While the pronouncement highlighted the great electricity demands of crypto operators, it also illustrated how Musk and other big personalities can influence the market.

Dogecoin, the popular meme token that has been a window into the exuberance of the crypto market, sank more than 6 percent, to about 19 cents. That’s well off the high of 72 cents set last month, leading up to Musk’s appearance on “Saturday Night Live.”

As with other digital currency sell-offs, bitcoin’s plummet has dragged much of the market with it. Most of the 20 largest tokens by market cap fell on Tuesday, several by double digits, according to CoinMarketCap, the cryptocurrency tracker. Even as tokens recovered some lost ground in afternoon trading, the overall market has shed more than $1 trillion since May, when investor optimism fueled a record-shattering run.

On Monday, China’s major state-owned banks reiterated their commitment to not facilitate the trading of cryptocurrency, reinforcing a previous ban that Chinese authorities put in place to shield their economy from added risks.

Officials there have tightened rules against processing cryptocurrency and last month banned payment companies from providing services tied to crypto transactions, issuing another warning to investors and sending jitters through the market.

Meanwhile, in Iran, as part of an effort to reduce the frequency of power outages during a hot summer, the government banned the mining of cryptocurrencies last month, blaming operators for the heightened electricity demand. On Tuesday, state media said Iranian police seized 7,000 computer miners in an abandoned factory west of the capital city of Tehran, Reuters reported.

In the United States, Biden administration officials are reviewing potential oversight measures related to the speculative trading of the crypto market and cryptocurrency’s potential uses to facilitate crime. The White House and the Treasury Department are also backing a new plan to target cryptocurrency as part of a broader effort to curb tax avoidance.

Other national governments, however, are embracing crypto. Nayib Bukele, the president of El Salvador, backed legislation making bitcoin legal tender, allowing Salvadorans to use the token to buy goods or pay taxes. But analysts remain skeptical of bitcoin’s use as a stable currency because of its extreme price volatility.

Crypto’s staggering climb this year has coincided with record gains in the stock market and the emergence of “meme stocks,” pulling in waves of new investors attracted in part by the excitement generated on online forums.

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Wall Street has wrestled with its own volatility in recent days. After Friday capped the worst trading week since October, stocks rebounded Monday and set all-time highs on Tuesday.

The tech-heavy Nasdaq advanced 112.79 points, or 0.8%, to close at 14,253.27, its highest level. The S&P 500 climbed 21.65 points or 0.5%, to finish at 4,246.44, just shy of its all-time high. The Dow Jones industrial average added 68.61 points, or 0.2%, to end at 33,945.58.

For months, market observers had been anticipating how the Federal Reserve would react to an improving economic outlook and whether central bankers would signal an interest rate hike to curb inflation. While fears of climbing prices have weighed on investors, some analysts say that the interest-rate concerns may have been overstated.

Published : June 23, 2021

By : The Washington Post · Hamza Shaban

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https://www.nationthailand.com/business/40002330

Thai plastics industry tipped to grow 3.1% to THB1.04tn this year

Thailand’s plastics industry will grow 3.1 per cent to 1.043 trillion baht this year, according to a forecast issued by the Thai Bioplastics Industry Association (TBIA) on Tuesday.

TBIA president Viboon Pungprasert said the rise is being driven by growing demand for bioplastics, which will spur an estimated 16.6 per cent increase in exports of Polylactic acid (PLA) plastic pellets to generate 2.7 billion baht this year.

Thailand is the third-largest exporter in the world and has the largest bioplastics capacity in the Asean region. The government is therefore pushing Thailand to become a regional centre of the bioplastics industry, said Paiboon. But to meet that aim, bioplastics must be promoted in Thailand, where high production costs mean they still only account for 1 per cent of the 2 million tonnes produced per year, he added.

Paiboon said the state must create incentives via tax and other measures to promote biodegradable plastic packaging.

Thailand’s bioplastic industry is growing at a rate of 10 per cent per year, which is considered high. Despite the high growth, Thailand has not followed its bioplastics rivals India and China in introducing incentives. These include China’s rule that all single-use plastic must be biodegradable.

​​Paiboon pointed out that many countries around the world, including Thailand, are aware of the problem of plastic waste and therefore have guidelines to promote proper disposal and recycling. They also produce compostable bioplastics from raw agricultural materials such as starch from cassava, sugar from sugar cane, vegetable fat, etc.

“If you look at the outside, [bioplastics] are the same as ordinary plastic. But the effects on the environment, including degradation, are completely different,” he said.

However, the price of bioplastics in Thailand is 2-3 times higher than conventional plastics. Manufacturers cannot bear such high costs, so they mix their ingredients to produce Oxo or non-biodegradable plastics, while still advertising them as biodegradable, said Paiboon.

“Oxo-degradable plastics eventually break down to microplastics, which contaminate soil, water and air, and become an environmental problem, but consumers are misled into thinking they are eco-friendly bioplastics.”

Although the Natural Resources and Environment Ministry has banned Oxo-degradable, the ban is not legally enforceable, he added. As a result, some manufacturers continue to mix Oxo or other substances with conventional plastics, making them cheaper than real bioplastics while also misleading consumers into believing they are biodegradable. In addition, manufacturers are advertising Oxo plastics as “Biodegradable”, “Degradable”, “EDP” (Environmental Degradable Plastics) and other names to avoid government measures, he said.

Paiboon urged the government to use the law to enforce the ban on selling Oxo products and plastics containing other substances. As long as Oxo is sold in the market, he said, it’s difficult in Thailand to use real bioplastics.

Published : June 23, 2021

By : The Nation

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https://www.nationthailand.com/business/40002324

SET falls below 1,600 as other Asian indices climb

The Stock Exchange of Thailand (SET) Index closed at 1,599.23 on Tuesday, down 1.90 points or 0.12 per cent. Transactions totalled THB81.59 billion with an index high of 1,613.66 and a low of 1,598.56.

In the morning session, Krungsri Securities expected the day’s index to rebound to between 1,610 and 1,615 points after the US Federal Reserve pointed to strong US economic data.

It added that the index also gained positive sentiment from the rising oil price.

“However, the index would be pressured by the outflow of foreign funds,” Krungsri Securities said.

The 10 stocks with the highest trade value today were GUNKUL, KBANK, PTT, AOT, RCL, HANA, RBF, CBG, SIRI and BANPU.

Other Asian indices were up, except in Hong Kong:

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Japan’s Nikkei Index closed at 28,884.13, up 873.20 points or 3.12 per cent.

China’s Shanghai SE Composite Index closed at 3,557.41, up 28.23 points or 0.80 per cent, while the Shenzhen SE Component Index closed at 14,696.29, up 54.99 points or 0.38 per cent.

Hong Kong’s Hang Seng Index closed at 28,309.76, down 179.24 points or 0.63 per cent.

South Korea’s KOSPI closed at 3,263.88, up 23.09 points or 0.71 per cent.

Taiwan’s TAIEX closed at 17,075.55, up 12.57 points or 0.074 per cent.

Published : June 22, 2021

By : The Nation

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https://www.nationthailand.com/business/40002311

SET buoyed by Fed remarks on US economy, rise in oil price

The Stock Exchange of Thailand (SET) Index rose by 8.37 points, or 0.52 per cent, to 1,609.50 on Tuesday morning.

The SET Index closed at 1,601.13 on Monday, down 11.85 points or 0.73 per cent. Transactions totalled THB83.15 billion with an index high of 1,602.66 and a low of 1,590.55.

Krungsri Securities expected the day’s index to rebound to between 1,610 and 1,615 points after the Federal Reserve made positive remarks on the US economy and its monetary policy.

It added that the index also gained positive sentiment from the rising oil price.

“However, the index would be pressured by the outflow of foreign funds,” Krungsri Securities predicted.

It recommended that investors buy:

▪︎ PTT, PTTEP, IVL and BANPU, which benefit from the rising oil price.

▪︎ BCH, CHG, BDMS, MINT, CENTEL, ERW, AOT, CPALL, HMPRO, CPN, CRC, AAV, AMATA, WHA, BEM and BTS, which benefit from the country’s reopening.

Published : June 22, 2021

By : The Nation

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https://www.nationthailand.com/business/40002309

Marginal gains for gold as dollar weakens, US bond yield slides

The price of gold in Thailand rose by THB50 per baht weight in morning trade on Tuesday, in response to the weakening dollar and the decline in US bond yield.

The Gold Traders Association report at 9.31am showed the buying price of a gold bar at THB26,650 per baht weight and selling price at THB26,750, while gold ornaments were priced at THB26,166.16 and THB27,250, respectively.

At close on Monday, the buying price of a gold bar was THB26,600 per baht weight and selling price THB26,700, while gold ornaments were priced at THB26,120.68 and THB27,200, respectively.

Spot gold price on Tuesday was US$1,785 (THB56,468) per ounce after Comex gold on Monday rose by $13.9 to $1,782.9 per ounce.

Hong Kong gold price, meanwhile, rose by HK$10 to $16,520 (THB67,305) per tael, the Chinese Gold and Silver Exchange Society reported.

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Published : June 22, 2021

By : The Nation

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https://www.nationthailand.com/business/40002297

Bitcoin Falls to Two-Week Low as China Cracks Down on Crypto

Bitcoin fell to a two-week low amid an intensifying cryptocurrency crackdown in China.

The largest virtual currency fell 8% to $33,070 as of 11:12 a.m. in London. Ether declined 12% to $1,993.

China has ordered payment platform Alipay and domestic banks to not to provide services linked to trading of virtual currencies. The institutions were also ordered to cut off payment channels for crypto exchanges and over-the-counter platforms, the People’s Bank of China said in a statement.

It’s more evidence of China’s tougher stance on crypto that’s stretching from financial regulation to the energy demands of Bitcoin mining.

“The PBOC crackdown is going further than initially expected,” said Jonathan Cheesman, head of over-the-counter and institutional sales at crypto derivatives exchange FTX. “Mining was phase one and speculation is phase two.”

Separately, a Chinese city with abundant hydropower has stepped up action to rein in mining. A Ya’an government official told at least one Bitcoin miner that the city has promised to root out all Bitcoin and Ether mining operations with a year, said a person with knowledge of the situation.

In the backdrop, the appetite for risk assets has diminished after last week’s hawkish policy pivot by the Federal Reserve. Even though equity markets tipped into the green on Monday, analysts pointed to lingering jitters about frothy corners of the market.

“If, as I expect, the global buy-everything unwind continues this week, Bitcoin will feel those chill winds,” said Jeffrey Halley, senior market analyst at Oanda Asia Pacific.

Some commentators have said China’s hashrate — the computational power used to mine coins and process blockchain transactions — is waning amid harsher regulatory oversight.

The crypto faithful are also grappling with a tumble in tokens used in so-called decentralized-finance — or DeFi — applications. DeFi apps let people lend, borrow, trade and take out insurance directly from each other using blockchain technology, without use of intermediaries such as banks.

For instance, the DeFi Titanium token went from being valued at around $60 to $0 — a rare occurrence even for famously volatile crypto markets. Famed mogul Mark Cuban had invested, telling Bloomberg News earlier that though it represented a small percentage of his crypto portfolio, the wipe-out “was enough that I wasn’t happy about it.”

Published : June 22, 2021

By : Syndication Washington Post, Bloomberg · Joanna Ossinger

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https://www.nationthailand.com/business/40002292

Stocks stage comeback with revival of value trade

Stocks notched their biggest rally in five weeks as speculation the Federal Reserve will tighten policy at a gradual pace outweighed concern about the central banks hawkish pivot.

Arelative sense of calm returned to markets, with risk assets rebounding after last week’s sell-off. Energy, financial and industrial stocks drove gains in the S&P 500, while highflying tech companies underperformed. A gauge of small caps climbed more than 2%. Amazon.com Inc. fell as the online retail giant kicked off its Prime Day sale, with merchants curbing discounts amid rising shipping costs. Treasuries and the dollar retreated. Bitcoin sank as China intensified its cryptocurrency crackdown.

A number of influential voices said Monday the central bank’s outlook needs to be more attuned to inflation risks. Dallas Fed President Robert Kaplan said he favors starting the process of reducing bond purchases “sooner rather than later,” while his counterpart from St. Louis James Bullard called it “appropriate” that policymakers opened the taper debate. Former Treasury Secretary Lawrence Summers and billionaire investor Ray Dalio said the U.S. is headed for a period of overheating and inflation that could threaten the economic recovery.

Despite the more hawkish rhetoric from central bank officials, Fed tightening should happen at a much slower pace when compared to the rush to loose policy at the start of the pandemic, according to Charles Schwab & Co.’s Jeffrey Kleintop.

“The way back up in terms of rate hikes may be much more gradual, and that might allow economically sensitive stocks to perform well,” said Kleintop, chief global investment strategist at the firm.

These are some of the main moves in financial markets:

Stocks

– The S&P 500 rose 1.4% as of 4 p.m. EDT

– The Nasdaq 100 rose 0.6%

– The Dow Jones industrial average rose 1.8%

– The MSCI World index rose 0.8%

Currencies

– The Bloomberg Dollar Spot Index fell 0.4%

– The euro rose 0.5% to $1.1918

– The British pound rose 0.9% to $1.3932

– The Japanese yen was little changed at 110.28 per dollar

Bonds

– The yield on 10-year Treasurys advanced five basis points to 1.49%

– Germany’s 10-year yield advanced three basis points to -0.17%

– Britain’s 10-year yield advanced two basis points to 0.77%

Commodities

– West Texas Intermediate crude rose 2.8% to $73.62 a barrel

– Gold futures rose 0.8% to $1,783.20 an ounce

Published : June 22, 2021

By : Syndication Washington Post, Bloomberg · Rita Nazareth, Claire Ballentine

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https://www.nationthailand.com/business/40002291

Oil may hit $100 a barrel next year on demand rebound, BofA says

Oil may surge to $100 a barrel next year as travel demand rebounds, Bank of America said, the strongest call yet among major forecasters for a return to triple digits.

Global oil consumption will continue to outstrip supply in 2022 as the economic recovery from the pandemic boosts fuel consumption, while investment in new production is crimped by environmental concerns, the bank said in a report.

“There is plenty of pent-up oil demand ready to be unleashed,” said Francisco Blanch, the bank’s New York-based head of commodities research. Brent futures traded near $74 a barrel on Monday.

While other market-watchers, from trading house Trafigura Group to Goldman Sachs Group, have already said that oil could reach $100 again in the right conditions, the prediction from Bank of America is the firmest to date.

If crude does return to triple digits, it will be the first time since 2014, before a flood of North American shale oil sent the market into a slump from which it has never fully recovered.

The increasingly bullish outlook for oil is adding to pressure on the OPEC+ coalition led by Saudi Arabia and Russia, which meets next week to consider reviving some more of the production it cut during the pandemic.

While Riyadh has signaled it prefers to move cautiously, an ever-tighter world market could compel the alliance to open the taps a little. Prices have been stoked this month as fellow OPEC member Iran fails to clinch an agreement to relieve U.S. sanctions on its petroleum exports.

According to Bank of America, the immediate prospects for the OPEC+ alliance are bright.

Oil consumption will be bolstered next year as mass transit struggles to keep pace with extra travel demand, prompting passengers to make greater use of private cars.

Even the ongoing popularity of remote working won’t dent fuel consumption as much as expected, as home-workers use cars during the day to run personal errands, the bank said.

“Work-from-home means ‘work-from-car’ in many cases,” Blanch said.

At the same time, the bank expects that new oil supplies will remain constrained. Shareholders will pressure major companies to invest in renewable energy, or push shale drillers to return cash rather than spend on new drilling.

Still, expectations for a tight market in 2022 are far from unanimous. A report from the International Energy Agency earlier this month showed that half of the projected increase in demand can be met by recovering output outside OPEC, predominantly from the U.S.

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That would leave the Organization of Petroleum Exporting Countries and its partners with significant quantities of idle output — and even more if Iran can strike a nuclear accord with the U.S. by then.

Published : June 22, 2021

By : Syndication Washington Post, Bloomberg · Grant Smith

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https://www.nationthailand.com/business/40002288

Asean-Canada FTA expected to boost Thai GDP by 255bn baht

Thailand’s Trade Negotiations Department on Monday revealed progress in talks over an Asean-Canada free trade agreement (FTA) that is expected to boost Thai GDP by 255 billion baht.

Thai trade negotiators met virtually with their US and Canadian counterparts on June 14-15 to discuss the framework of the Asean-US Trade and Investment Agreement and the scope of the Asean-Canada FTA.

Progress was made in extending the Asean-Canada FTA to areas such as labour, the environment and state enterprises, department deputy director-general Sunart Nithi-Uthai reported.

Results from the talks will be presented to the Asean-Canada Economic Ministers Meeting in September so that FTA negotiations can begin this year, he added.

The Asean Secretariat’s study of the Canada FTA estimates it would boost Thailand’s GDP by 1.97 per cent or US$7.967 billion (about 254.944 billion baht). Meanwhile, Asean GDP would rise by an estimated 1.6 per cent or $39.361 billion (1.26 trillion baht), while Canada’s GDP would increase by 0.3 per cent or $5.104 billion (163.328 billion baht).

Published : June 22, 2021

By : The Nation

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https://www.nationthailand.com/business/40002289

Business leaders push Prayut to lower credit bar for struggling SMEs

Prime Minister Prayut Chan-o-cha will hold talks with the Thai Chamber of Commerce on Wednesday (June 23) in a bid to boost liquidity for SMEs struggling to stay afloat during the pandemic.

The chamber will press the PM to inject financial institutions’ spare liquidity into small and medium enterprises (SMEs), including retail operators, at an acceptable risk level, revealed Sanan Angubolkul, chairman of the chamber’s board.

He said the government should have a central policy that encourages financial institutions to release more loans.

The chamber is also in talks with three commercial banks – Kasikorn, Siam Commercial and Bangkok Bank – for further SME debt-relief measures and will discuss the same with Thai Military Bank, Krung Thai Bank, and Kiatnakin Phatra Bank. It said the banks need to help debtors, but there are still restrictions that must be addressed.

Meanwhile the Finance Ministry’s asset warehousing project has received few applicants because its tight conditions caused worry among both commercial banks and debtors themselves, the chamber said. Debtors were worried about possible obstacles when it comes to retrieving their assets, while banks were worried that debtors who deposited assets with them might not return. The chamber also said the bar against credit bureau data being included in criteria for credit approval should be lifted, as it was preventing SMEs from accessing funding sources.

It also urged the government to accelerate its co-payment scheme subsidising 50 per cent of employee salaries as payments had lapsed for more than a year.

It urged the government to apply additional assistance measures, pointing out that incomes continue to decline in the face of Thailand’s ongoing third and biggest wave of Covid-19.

Published : June 21, 2021

By : The Nation