The Stock Exchange of Thailand (SET) Index closed at 1,401.78 on Monday, down 80.6 points or 5.44 per cent. Total transactions amounted to Bt129.43 billion with an index high of 1,453.88 and a low of 1,401.58.
The index fell sharply after Thailand registered 576 new Covid-19 cases on Sunday, its largest single-day spike since the outbreak began.
The 10 stocks with the highest trade value today were KBANK, BANPU, PTT, STGT, CPALL, AOT, ADVANC, IVL, CPF and PTTGC.
As of 4.30pm, the price of oil dropped by US$1.95 or 3.97 per cent to $47.15 per barrel, while gold rose by $11.30 or 0.60 per cent, to $1,900.20 per ounce.
Other Asian indices were mixed:
Japan’s Nikkei Index closed at 26,714.42, down 48.97 points or 0.18 per cent.
China’s Shang Hai SE Composite Index closed at 3,420.57, up 25.67 points or 0.76 per cent, while Shenzhen SE Component Index closed at 14,134.85, up 280.73 points or 2.03 per cent.
Hong Kong’s Hang Seng Index closed at 26,306.68, down 191.92 points or 0.72 per cent.
South Korea’s KOSPI Index closed at 2,778.65, up 6.47 points or 0.23 per cent.
Taiwan’s TAIEX Index closed at 14,384.96, up 135.00 points or 0.95 per cent.
Singapore’s Straits Times Index closed at 2,844.30, down 4.68 points or 0.16 per cent.
Vietnam’s Ho Chi Minh Stock Index closed at 1,081.08, up 13.62 points or 1.28 per cent.
The Department of International Trade Promotion (DITP) has asked Thailand’s commercial counsellors posted overseas to hasten work on ensuring confidence of Thai seafood importers about food safety.
Somdet Susomboon, DITP director-general, said importers need to be made to understand that Thai food is exported in strict compliance with international standards and rules to curb the transmission of Covid-19.
Commerce Minister Jurin Laksanavisit has asked his ministry to coordinate with related state agencies to monitor the outbreak in Samut Sakhon, where the Central Shrimp Market has emerged as the source of infections.
Thailand’s export of frozen, canned and processed seafood (excluding shrimp) stood at Bt115.91 billion in the first 10 months of the year. The export of frozen and processed shrimp, not including canned shrimp, was worth Bt27.35 billion.
The Bank of Thailand and Bank Indonesia on Monday announced the expansion of the rupiah-baht settlement framework.
The framework was first launched on December 11, 2017 under a memorandum of understanding signed by the two central banks on December 23. The expansion is a part of continuous efforts to promote wider use of local currencies to facilitate and enhance trade and direct investment between Indonesia and Thailand, the banks said.
The framework was expanded to include direct investment as an eligible underlying transaction in addition to trade, and to further relax relevant foreign exchange rules and regulations, for example, through more flexible documentation requirements, they said.
In this connection, Bank Indonesia and the BOT have appointed additional qualified commercial banks in both countries to support the operationalisation of the expanded rupiah-baht settlement framework. In general, the appointed banks are resilient and healthy, experienced in facilitating trade or capable of providing various financial services, and have strong business relationships with banks in the counterparty country, they said.
The appointed banks are:
Additional appointed banks in Thailand:
– CIMB Thai Bank Pcl
– TMB Bank Pcl
– Standard Chartered Bank (Thai) Pcl
– The Hongkong and Shanghai Banking Corporation Limited Bangkok Branch
The Stock Exchange of Thailand (SET) Index fell by 45.49 points, or 3.07 per cent, to 1,436.89 in the morning session on Monday.
The index fell sharply due to the surge in Covid-19 cases in Thailand, by 576 on Sunday, the highest single-day spike since the outbreak.
The top 10 stocks with the highest trade value in the morning session were KBANK, STGT, PTT, CPALL, AOT, CPF, BANPU, DELTA, BAM and IVL.
An analyst at Kasikorn Securities expected the SET this week to move between 1,465 and 1,500, advising investors to follow the Monetary Policy Committee meeting, Thai exports in November, the Covid-19 situation, the US-China conflict and Brexit negotiations.
The SET Index closed at 1,482.38 on Friday, down 1.51 points or 0.1 per cent. Total transactions amounted to Bt117.09 billion with an index high of 1,489.78 and a low of 1,475.01.
The price of gold surged by Bt300 per baht weight in morning trade on Monday after rising by Bt50 per baht weight at close on Saturday, the Gold Traders Association reported.
As of 9.26am, the buying price of a gold bar was Bt26,800 per baht weight and selling price Bt26,900 while gold ornaments were priced at Bt26,317.76 and Bt27,400, respectively.
At close on Saturday, the buying price of a gold bar was Bt26,500 per baht weight and selling price Bt26,600 while gold ornaments were Bt26,029.72 and Bt27,100, respectively. The price jumped by Bt350 per baht weight last week.
Spot gold price moved to US$1,898 (Bt56,966) per ounce in the morning, while Comex (Commodity Exchange) gold price to be delivered in February next year dropped by $1.5 to $1,888.9 per ounce on Friday due to the dollar’s appreciation and mass sell-offs of the precious metal after the price hit the highest level in six weeks on Thursday.
Hong Kong gold price rose by HK$90 to $17,460 (Bt67,578) per tael, the Chinese Gold and Silver Exchange Society reported.
The Fiscal Policy Office (FPO) believes Brexit is unlikely to have much impact on the Thai economy, as the value of trade, investment and tourism between the two countries is not high.
Pisit Puapan, FPO director of Macroeconomic Policy Bureau, said that last year the UK was ranked the 20th major export destination for Thai goods and services, accounting for only 1.6 per cent of Thailand’s total export. UK was the 12th largest investor in Thailand last year.
However, he added that Thailand should rush to hold trade talks with UK to foster trade ties after Brexit and seek ways to provide more convenience to traders between the two countries.
Thailand should also hold talks for a free trade agreement with the UK, he added.
The Federation of Thai Industries chairman, Suphant Mongkolsuthree, backed Pisit’s suggestion to initiate FTA talks with the UK and resume free-trade talks with the European Union (EU).
The Department of Trade Negotiations recently released a complete study on the pros and cons of Thailand resuming free-trade talks with the EU for Commerce Minister Jurin Laksanawisit to consider.
The Institute of Future Studies for Development has completed the study, which shows that if Thailand and 27 EU members, excluding UK, cancel all import tariffs, then in the long run Thailand’s gross domestic product will be boosted by 1.28 per cent and be worth Bt205 billion per year.
President of the association, Charoen Laothamatas, said it would be the first time that Thai exports would be lower than that of Vietnam, which is expected to export a total of 6 million tonnes.
Thai rice export has faced many obstacles, including higher price when compared to competitors.
The situation has been aggravated by the strengtening baht, he added.
Honorary president Chookiat Ophaswongse added that the value of the estimated 5.7 million tonnes of rice export this year would be Bt115 billion, down 12 per cent year on year.
Another reason for the low export is the shortage of containers for transporting rice, he added.
The Electricity Generating Authority of Thailand (Egat) is in talks with AI and Robotics Ventures Co Ltd (ARV), a subsidiary of PTT Exploration and Production Pcl (PTTEP), to jointly explore a business opportunity in the future, Egat governor Boonyanit Wongrukmit said.
He added that one possible collaboration could be in the use of drones to inspect the conditions of Egat’s vast power transmission lines, which will help it reduce the cost of inspection.
He said that while Egat has demand to use such drone technology, ARV has the knowledge and technology, which will enhance Egat’s efficiency in the transmission line inspection. Both organisations can also team up to provide this service to other state-run electricity authorities.
ARV provides cutting-edge artificial intelligence and robotics solutions for businesses across industries. The application of ARV services and developing technologies ranges across air, sea and land.
In July this year, ARV formed a partnership with Thai Advance Innovation Co Ltd (Thai AI), a subsidiary of Thaicom Plc, on the development of drone technology with focus on agriculture drone to enable advanced smart farming solutions.
Financial experts believe investment outlook is bright for the first half of next year although recent rallies in many markets might make equities look expensive.
Siriporn Suwannagarn, managing director and financial advisory head of banking at Private Banking Group, expressed confidence that the availability of a Covid-19 vaccine, coupled with huge liquidity and new government stimulus packages would make the global economy grow faster next year.
“In the past month, the success in developing a vaccine would be a very good game changer for next year, as the vaccine would help us reopen the economy on a broad-based basis,” she told the Nation.
Many countries in the second half of this year have started to reopen their economies after they shutdown most businesses in the first half due to the coronavirus outbreak.
For the second half, they could not fully reopen all economic sectors, as services sector businesses such as air travel and tourism are still faced with limitations because of the persisting virus threat.
Lately some countries including Thailand have resumed lockdown restrictions in some cities due to a new round of infections.
Some countries such as the United Kingdom and the United States have started mass vaccination, making people hopeful that the spread of the virus would be contained.
“In terms of economic growth, we could see a short-term spike in growth for the first half of next year, and probably a little bit of a slowdown in the second half,” Siriporn said.
She expected the huge liquidity injected by central banks globally would remain next year due to no risk of inflation.
The US Federal Reserve is expected to keep its policy rates low and the US government led by president-elect Joe Biden will continue to support the economy via large fiscal spending, she predicted.
Expecting a bright outlook for next year investors have been very active in stock markets, pushing the index of many markets back to pre-virus levels.
Asked about equities looking expensive now, Siriporn said that investors have to look at specific sectors and stocks, not just look at broad-based valuation (price to earnings of the S&P or of the SET).
Anticipating more economic stimulus packages by the new US government, the US dollar is on a weakening trend. Siriporn suggested that investors also turn their focus to non-US equities, such as Asian stocks and China’s stocks in particular and some European assets.
For fixed income products, investors should look at corporate bonds and high yield bonds, as the government bond yield is too low, she said.
She, however, warned that despite the availability of a vaccine, there are still many challenges and markets are subject to volatility, so investors are recommended to diversify their portfolios.
Meanwhile, KBank Private Banking (KPB) head Jirawat Supornpaibul said that his clients were very lucky as most of them are richer from investments in 2020 which is a challenging year for investment.
“Those who take more risks have more returns, but those who take less risk, might not get better returns,” he said, in summing up the performance of KBank Private Banking doing investment management for wealthy clients this year.
This year, the US, China and Japan markets performed very well while Europe and Thailand did not, he said.
He forecast that equities, especially Asian stocks, would be the focus of investor communities in the first half of next year. His view is shared by many fund managers.
JP Morgan is overweight on Indonesia, South Korea and Thailand, according to CNBC channel.
Jirawat, however, warned that risks were still there and investors have to balance equities with other assets. He suggested that investors also hold onto gold.
Jirawat’s 10 tips to investors for the first half of next year are:
1. Stay invested in global equities
2. Don’t miss Asian equities
3. Capture recovery with cyclical and small/mid-cap
4. Maintain portfolio balance
5. Enhance returns through emerging market high yields
6. Hold onto gold, for now
7. Complement returns through private
assets and hedge funds
8. Position for weakness in the US dollar
9. Strengthen in emerging
currencies
10. Sustainability
In terms of sustainability, Jirawat suggested that investors look at companies which take care of environment issues, and ignore businesses that pollute the world.
Thai experts are worried that Britain’s impending withdrawal from the European Union (EU) could hit Thailand’s trade and investment in the country.
Krungthai Compass research centre’s senior director Phacharaphot Nuntramas said if Britain exits the EU without a deal on January 1, the pound is expected to weaken by about 10 per cent to 1.20 against the US dollar.
This would cause importers and exporters to delay trade in British products, he said.
“However, we believe that Britain and the EU can reach a deal to maintain trade privileges or else extend the negotiation period for up to three months,” he added, citing the far greater urgency of the Covid-19 crisis.
CIMB Thai Bank head of research Amonthep Chawla said the unclear direction of Brexit negotiations had triggered fears of higher product prices and inflation as the pound sterling had weakened sharply.
He also expects to see Brexit negotiations extended for another three months due to the Covid-19 outbreak, adding that the talks would not lead to a global financial crisis.
“However, Thailand should seek to sign a free trade agreement [FTA] with Britain to boost exports,” he said.
Siwat Luangsomboon, deputy managing director of Kasikorn Research, said Britain would face difficulties whether or not the outcome was a no-deal Brexit, as more than half of the country’s exports are to European countries.
Brexit would have no affect on Thailand since 2 per cent of Thai exports go to Britain, he said, adding that Thailand should still sign an FTA with Britain to boost exports.
“Whether or not we see a no-deal Brexit, the result will not impact financial markets because they have already priced in the outcome,” he said.
Egat governor Boonyanit Wongrukmit 
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