SET gains, but worries over Covid-19, foreign fund flows cast shadow
The Stock Exchange of Thailand (SET) Index rose by 4.05 points or 0.26 per cent to 1,563.28 in the morning session on Wednesday. The volume of transactions was THB5.84 billion, with an index high of 1,567 and a low of 1,563.14.
AKrungsri Securities analyst forecast that the SET index would fluctuate between 1,550 and 1,570 points as investors awaited the outcome of an important US Federal Reserve meeting.
The Fed is expected to maintain the interest rate at 0.25 per cent and continue its quantitative easing policy.
“Meanwhile, uncertainty over higher Covid-19 cases in Thailand and volatility in foreign fund flows would pressure the index,” the analyst predicted.
He recommended investors buy:
▪︎ PSL, TTA and RCL, which would benefit from a rise in the freight rate.
▪︎ PTTEP, PTTGC and IVL, which benefit from the rising oil price.
▪︎ PTTGC, IVL, EPG, SCGP, SCC, CPF, BCH, CHG, STGT, Global, DoHome, CoM7, Synex, Stark and TWPC, whose first-quarter turnover is expected to improve.
The SET Index closed at 1,559.23 on Tuesday, down 0.30 points or 0.02 per cent. The volume of total transactions was THB97.52 billion, with an index high of 1,570.58 and a low of 1,553.03.
The baht opened at 31.36 to the US dollar on Wednesday, strengthening from its close of 31.43 on Tuesday.
The Thai currency is likely to move between 31.30 and 31.45 during the day, Krungthai Bank market strategist Poon Panichpibool said.
He predicted that the baht would fluctuate on Wednesday over concern of the Covid-19 situation in Thailand.
However, the baht would weaken slightly as exporters aim to sell the currency when it goes to 31.45-31.50 per US dollar.
Poon warned that foreign investors could sell their Thailand assets in case the virus situation worsened. In this situation, the baht would be weaker, despite a stable dollar, he added.
Gold price falls by THB100 ahead of US Fed meeting
The price of gold in Thailand dropped by THB100 per baht weight in morning trade on Wednesday as investors delayed trading to follow the outcome of a key Federal Reserve meeting and the US first-quarter gross domestic product.
AGold Traders Association report at 9.22am showed the buying price of a gold bar was THB26,250 per baht weight and selling price THB26,350, while gold ornaments were priced at THB25,772 and THB26,850, respectively.
At close on Tuesday, the buying price of a gold bar was THB26,350 per baht weight and selling price THB26,450, while gold ornaments cost THB25,878.12 and THB26,950, respectively.
The spot gold price on Wednesday touched US$1,772 (THB55,656) per ounce compared to Tuesday, when it dropped by $1.30 to $1,778.80 per ounce.
The Hong Kong gold price on Wednesday dropped by HK$60 to $16,410 (THB66,398) per tael, the Chinese Gold and Silver Exchange Society reported.
Tech stocks retreat with megacap earnings in focus
U.S. technology stocks fell as investors turned their attention to a batch of earnings from industry heavyweights that have helped drive the market to all-time highs.
The Nasdaq 100 dropped for the first time in three sessions, weighed down by declines in tech heavyweights including Tesla Inc. and Alphabet Inc. The S&P 500 closed little changed after swinging between gains and losses throughout the day. United Parcel Service Inc. soared to a record after beating Wall Street’s profit estimates.
Tesla ended a two-day streak of gains after its results failed to impress investors. 3M Co. was the biggest drag on the Dow Jones industrial average after it warned that higher costs for raw materials and transportation is a worsening threat. Google parent Alphabet climbed more than 4% postmarket, erasing its cash-session decline after profit and revenue exceeded analysts’ estimates. Microsoft Corp. reversed a gain and dropped 3.5% as investors parsed its results.
Apple Inc. and Amazon.com Inc. are set to release results later this week.
While the earnings season has been generally strong so far, investors may be waiting for more robust beats to fan the next move higher. Four out of five S&P 500 companies that have released results have either met or beaten expectations. On average, shares have gained less than 0.1% after the reports, according to data compiled by Bloomberg.
“Earnings optimism already was largely embedded into expectations moving into the current earnings period, so investors are looking for substantially outsized positive results, without which stock price advances will be muted and, like today, could take a hit,” said Greg Bassuk, chief executive officer at AXS Investments.
Meanwhile, U.S. data this week are expected to show growth accelerated to an annualized 6.8% in the first quarter. A Conference Board measure Tuesday showed consumer confidence reached the highest since February 2020 as Americans grew more upbeat about the economy and job market.
Such reports aren’t shifting the Federal Reserve’s highly accommodative stance, with the central bank expected to keep policy unchanged at this week’s meeting.
“Since the last Fed meeting, strong economic expectations have started to make their way into the data,” said Lauren Goodwin, economist and portfolio strategist at New York Life Investments. “We’re seeing that reflected not only on the economic side but also in pretty impressive earnings reports on the whole.”
The Stoxx Europe 600 Index slid as investors weighed the scope for further gains. HSBC Holdings Plc rose after saying quarterly earnings more than doubled and returning to profit in Europe and the U.S.
The Bloomberg Commodity Index climbed for a seventh day as copper extended a rally on the Biden administration’s plans for a large infrastructure package. Oil climbed after OPEC+ projected a strong recovery beyond near-term demand destruction from India’s covid-19 surge.
These are some of the main moves in markets:
Stocks
– The S&P 500 was little changed as of 4:01 p.m. EDT
– The Nasdaq 100 fell 0.4%
– The Dow Jones industrial average was little changed
– The MSCI Emerging Markets Index was little changed
Currencies
– The Bloomberg Dollar Spot Index rose 0.2%
– The euro was little changed at $1.2089
– The British pound was little changed at $1.3906
– The Japanese yen fell 0.6% to 108.74 per dollar
Bonds
– The yield on 10-year Treasurys advanced six basis points to 1.62%
– Germany’s 10-year yield was little changed at -0.25%
– Britain’s 10-year yield advanced two basis points to 0.77%
Commodities
– West Texas Intermediate crude rose 2.1% to $63 a barrel
– Gold futures fell 0.3% to $1,776 an ounce
Published : April 28, 2021
By : Syndication Washington Post, Bloomberg · Vildana Hajric, Kamaron Leach
Cabinet okays proposal to cut export tariff on Thai rice
The Cabinet agreed on Tuesday to reduce export tariff for rice heading to Europe and the United Kingdom in a bid to boost the competitiveness of Thai rice in the world market.
Deputy government spokesperson Ratchada Thanadirek said the Commerce Ministry had proposed the reduction on tariff based on agreements between Thailand and the European Union as well as UK.
Thai rice has recently been losing out in the global market to newly developed strains of rice offered by other countries, but reduced export tariff will make it more competitive.
Under the new regulations, the export price of white fragrant rice and 100-per-cent parboiled rice will come down to THB1,500 per tonne from THB2,500, while for the UK, it will go down to THB1,200 per tonne.
EXIM Thailand launches relief schemes for Thai CLMV businesses
The Export-Import Bank of Thailand has thrown a credit lifeline to small Thai businesses in CLMV countries that have been hit by the pandemic as well as the crisis in Myanmar.
EXIM Thailand is offering the SMEs a 3-year credit facility of up to THB20 million at 3.99 per cent interest per annum. Meanwhile, its clients in the Myanmar market can get principal debt suspension of up to 12 months for long-term loans.
Thai exports to CLMV (Cambodia, Laos, Myanmar and Vietnam) fell more than 11 per cent in 2020 and continue to suffer this year amid resurgent Covid-19 and tensions in Myanmar, said EXIM Thailand president Rak Vorrakitpokatorn.
As a result, Thai SMEs trading in the CLMV need swift liquidity injections to overcome the short-term challenges they face.
The bank said it currently has over 200 clients in Myanmar with total credit of around THB5.3 billion.
Businesses can apply for the EXIM CLMV Comfort Credit Scheme until November 30 via the bank’s website: www.exim.go.th.
Businesses engaged with Myanmar can apply for principal suspension for up to 12 months for long-term loans, or roll-over of promissory notes for up to 180 days, via bank staff until September 30.
EXIM Thailand also offers advice to Thai exporters and investors in Myanmar via its hotline at (02) 271 3700 ext 3009.
SET levels out as investors wait on US Fed meeting
The Stock Exchange of Thailand (SET) Index closed at 1,559.23 on Tuesday, down 0.30 points or 0.02 per cent. The volume of total transactions was THB97.52 billion with an index high of 1,570.58 and a low of 1,553.03.
In the morning session, Krungsri Securities forecast Tuesday’s SET Index would fluctuate between 1,550 and 1,570 points as investors delayed purchases to await the outcome of the US Federal Reserve meeting on Wednesday.
The Fed is expected to maintain the interest rate at 0.25 per cent and continue its quantitative easing policy.
Krungsri Securities said uncertainty over the increasing number of Covid-19 cases in Thailand and volatility in foreign fund flows would pressure the index.
“However, the index would rebound as investors speculate on stocks that gain positive sentiment and companies whose first-quarter performance is likely to improve.”
The 10 stocks with the highest trade value today were AOT, BFIT, SCGP, KBANK, TSTH, NER, SCC, GJS, INOX and ROJNA.
Other Asian indices were mixed:
Japan’s Nikkei Index closed at 28,991.89, down 134.34 points or 0.46 per cent.
China’s Shang Hai SE Composite Index closed at 3,442.61, up 1.45 points or 0.042 per cent, while the Shenzhen SE Component Index closed at 14,264.08, up 39.64 points or 0.28 per cent.
Hong Kong’s Hang Seng Index closed at 28,941.54, down 11.29 points or 0.039 per cent.
South Korea’s KOSPI closed at 3,215.42, down 2.11 points or 0.066 per cent.
Taiwan’s TAIEX Index closed at 17,595.90, up 23.61 points or 0.13 per cent.
SET under short-term pressure as investors keep an eye on US Fed meeting
The Stock Exchange of Thailand (SET) Index rose by 0.09 points, or 0.01 per cent, to 1,559.62 in the morning session on Tuesday. The volume of total transactions was THB11.70 billion with an index high of 1,564.87 and a low of 1,558.75.
AKrungsri Securities analyst forecast the SET Index would fluctuate between 1,550 and 1,570 as investors would delay their investments to follow the US Federal Reserve meeting on April 27-28.
It is expected that the Fed would maintain the interest rate at 0.25 per cent and continue the quantitative easing policy.
He said uncertainty over higher Covid-19 cases in Thailand and volatility in foreign funds flow would pressure the index.
“However, the index would rebound from investors speculating on stocks that gain positive sentiment and whose first-quarter performance is likely to improve,” he said.
He recommended that investors buy:
▪︎ PSL, TTA and RCL, which would benefit from a rise in the freight rate.
▪︎ HANA, KCE, SMT, TU and CPF, which benefit from the weakening baht.
▪︎ PTTGC, IVL, EPG, SCGP, SCC, CPF, BCH, CHG, STGT, GLOBAL, DOHOME, COM7, SYNEX, STARK and TWPC, whose fourth-quarter turnover is expected to improve.
The SET Index closed at 1,559.53 on Monday, up 5.94 points or 0.38 per cent. Total transactions amounted to THB83 billion with an index high of 1,561.52 and a low of 1,544.10.
The price of gold in Thailand dropped by THB50 per baht weight in morning trade on Tuesday as the global market is keeping an eye on the US Federal Reserve meeting on April 27-28 and US first-quarter gross domestic product data.
The Thai Gold Traders Association report at 9.29am showed buying price of a gold bar at THB26,350 per baht weight and selling price at THB26,450, while gold ornaments were priced at THB25,878.12 and THB26,950, respectively.
At close on Monday, the buying price of a gold bar was THB26,400 per baht weight and selling price THB26,500, while gold ornaments were THB25,923.60 and THB27,000, respectively.
Spot gold price on Tuesday was US$1,775 (THB55,853) per ounce compared to Monday when it rose by $2.3 to $1,780.1 per ounce.
Hong Kong gold price on Tuesday rose by HK$10 to $16,490 (THB66,863) per tael, the Chinese Gold and Silver Exchange Society reported.
Struggling hoteliers eye the exit as occupancy plummets
The fresh wave of Covid-19 has severely affected tourism and hospitality businesses in Thailand with occupancy rates at domestic hotels dropping to 5-30 per cent, forcing many operators to sell their businesses to cut losses, said Thammajak Leuangprasert, president of Arjarnnar Asset Management Group.
“Some hotels affected by the outbreak for more than a year have managed to stay afloat with the help of soft loans and the debt moratorium programme, while some have decided to sell their businesses to foreign investment groups,” he said. “Currently there are European and Chinese companies looking to buy 4-5 star hotels in Thailand priced at over Bt2 billion, while 3-star hotels are also desirable provided they are in a prime location.
“Investors are eyeing hotels in Thailand as our country is a prominent tourism destination, while the outbreak has driven the selling price down and makes it an excellent opportunity to buy,” he added.
In addition to hotels, foreign investors are also interested in the hostel business in Thailand and neighbouring countries as well.
Edmund Lowman, CEO of Collective Hospitality Group, said that the company had invested Bt450 million in buying the Bodega Hostel Group, which manages hostels offering over 2,500 beds in Thailand, Indonesia and Cambodia. This move has made the Collective Hospitality Group the biggest hostel operator in Asean and the fourth biggest in the world.
Meanwhile, Marisa Sukosol Nunbhakdi, president of Thai Hotels Association, has said that due to the Covid-19 third wave, hotel operators nationwide are in need of financial aid from the government.
“The government’s soft loan and debt moratorium programme only partly helped the hotel industry,” she said. “What we really need is a co-payment programme that would help pay half of employee wages to keep the business afloat and maintain employment.”
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