MSCI is expected to raise its weighting in the Stock Exchange of Thailand, while a US interest-rate rise is not expected this month because of concerns over the result of the upcoming US presidential election, said Wilasinee Boonmasungsong, an executive at Globlex Securities.
These are both positive factors for the SET, he added.
The FOMC meeting was scheduled to conclude yesterday and the US presidential election will take place on November 8.
Apichai Raomanachai, deputy managing director for research at Apple Wealth Securities, said the FOMC meeting and US presidential election could affect foreign capital movement in Thailand, Indonesia and the Philippines.
He forecast that the SET Index would swing in a range of 1,435-1,540 points on a buying spree by local institutional investors this month and next, and speculation over third-quarter earnings performance.
Globlex Securities expects the SET Index to rise with volatility in a range of 1,480-1,520 points.
The index closed yesterday at 1,498.65, down 5.87 points from Tuesday on trading value of Bt49.33 billion.
Foreign investors had net sales of Bt846.84 million.
“In November, the decision on the US rate’s movement should be monitored. One rate hike is expected, at the December meeting [of the FOMC]. Other factors that need monitoring include the result of the US presidential election, and the Opec meeting on November 30 on whether to reach an agreement to reduce oil production,” Apichai said.
He expects no monetary-policy changes from the Fed, the Bank of Japan or the European Central Bank this month.
Next year, the SET Index is expected to move in a range of 1,400-1,750 points, while listed companies’ estimated earnings growth in 2017 is projected at 10 per cent on average, said Prapas Tonpibulsak, chief investment officer at Talis Asset Management.
Small and medium-sized stocks are forecast to see higher earnings growth, he said.
Talis Asset Management yesterday launched the Talis Long Term Equity Fund (TLLTFEQ), focusing on stocks with sound fundamentals.
“This LTF is another alternative for investment amid the Thai stock market’s volatility,” said Chatrapee Tantixalerm, chief executive officer of the company.
The first purchase is set at a minimum of Bt1,000.

History suggests the movement of China’s housing market is significant enough to directly affect investment and consumption. The market accounts for approximately 25% of China’s GDP, which played a huge factor in the recent rebound of GDP’s growth to stabilize roughly at 6.7%, in help together with a robust infrastructure spending and strong auto sales.
Though, the rebound of the housing market raised many flags due to the increase of investors buying and selling houses for a profit, instead of owner-occupiers. Furthermore, the increase in borrowing of home buyers is extremely tormenting.Q3’s data recently showed new loans reaching 1.22 Yuan, where 39% is accounted towards mortgage loans. Therefore, in the past two weeks more than 20 top tier cities have been imposing new measures including raising required down payments, prohibiting illegal fund raising for home payments and controlling the land supply in urban areas to slow down the market.
The biggest cause of a housing market crash is by over-borrowing of home buyers, but correspondingly Chinese officials have been doing a very decent job and able to limit the over borrowing amount thus far. Despite a recent surge in mortgage lending, the household balance sheet is overall in good shape. In addition, strict down payment regulations state that buyers will generally put down as much as half of the housing price. Besides, even if the prices fall, buyers are unlikely to walk away from their mortgage debt.
Global investors and analysts have been predicting a crash in the Chinese real estate for more than better part of a decade, however there has been no nationwide crash. Moreover, the price of the market have been weaken for over a certain period, typically when the government starts intervening with the buying side of the housing market, and only to stop this measure once every few years.
We absolutely cannot deny that the housing market is facing problems but still is ways away from a “bubble”.
Lastly, it is imperative that the slowdown in the housing market causes slower sales and a slacker demand for raw materials, furniture and household goods, thus putting pressure on future growth of the economy. Given this constraint, it is unlikely that the officials would revert to tighten monetary policy. However, there still more room in which fiscal policy would ultimately position the world’s second-largest economy back on track for a sustainable growth path.
Investment contains risk. The investors should thoroughly study prospectuses, product features, return conditions and risk before investing.
Contributed by Asset Plus Fund Management

The ministry reported the 10-month inflation rate of 0.06 per cent after October’s CPI edged up 0.34 per cent year on year, the seventh consecutive month of positive inflation, attributed to higher fuel prices.
Month-on-month inflation was 0.16 per cent on higher prices for fuel and some goods, especially vegetables.
The ministry has retained its inflation projection for this year at 0-1 per cent as it expects higher inflation in the remaining months.
The projection assumes the price of Dubai crude oil will average US$35-$45 per barrel, higher than the previous forecast of $30-$40, but the baht’s appreciation will offset the higher oil-import value. The baht will range between 35 and 37 to the US dollar.
Gross domestic product will grow by 2.8-3.8 per cent this year, the ministry predicts.
“Amid positive signs of a recovery in inflation, the ministry will retain the inflation target for this year, as inflation has gradually returned to positive territory,” Pimchanok Wornkorporn, deputy director-general of the ministry’s Policies and Trade Strategies Bureau, said yesterday.
She said the expected slight increases in the CPI in the remaining months should benefit the economy and encourage more spending.
Last month, prices of foods and beverages rose 0.89 per cent year on year, while non-food-and-beverage prices increased 0.02 per cent.
Core inflation, which excludes volatile food and fuel prices, firmed in October by 0.74 per cent year on year and by 0.04 per cent month on month. Average core inflation in the first 10 months of the year was 0.74 per cent, which was in line with the Bank of Thailand’s forecast of 0.5-3 per cent.
Meanwhile yesterday, the BOT reported that the business sentiment index in October declined from 50.3 in September to 49.2, below the 50-point benchmark. This follows the lower confidence in the services sector.
The weaker activities were reflected by a relatively subdued degree of confidence in order books, production and performance sub-indices, especially from respondents in hotel and restaurant sector, affected by the reduction in the number of Chinese tourists resulting from the government crackdown on zero-dollar tours.
Auto-parts retailers indicated softer confidence due to a slowdown in domestic car sales. This was in line with fewer new orders and lower output by automobile producers, due to weak domestic demand as potential buyers wait for promotional campaigns at the Motor Expo late in the year.
For the next three months, most respondents remained positive, reflected by the index remaining above the 50-point mark. However, the proportion of respondents with an optimistic view declined in October from the previous month, reflected by the index declining from 54.7 to 53.4. This was the result of concerns about the business outlook in the manufacturing sector, particularly in the automobile sector.
The degree of negative sentiment was heightened by a decrease in orders and production and in performance sub-indices from expectations of a slowdown in automobile sales in the coming period.

BOI deputy secretary-general Ajarin Pattanapanchai told a seminar that it was a government mandate that the EV industry be developed, although most automakers oppose the plan as they fear that EVs would destroy the existing industry.
Ajarin said Prayut raised the issue at Monday’s BOI directors’ meeting, which he chaired, saying the carmakers’ concerns should be considered. But she said that it was likely that EV production would be minimal during the initial stage and would not affect the established industry.
She raised the example of the United States, where after six years of production, there are still only 250,000 EVs on the road, amid annual auto sales of 14 million to 15 million.
“However, I believe in the ‘disruption’ theory. EV technologies should reach a breakthrough very soon, similar to photovoltaic technology.
“This policy will certainly not be a flop. There are already many people preparing to invest,” she said.
Ajarin said BOI-promoted EV investors would be allowed to import completely built units (CBUs) in limited volumes, to test the market, with no import duty for two years, while they are building their factories.
After the start-up of the local EV plants, they will be able to import essential parts with no import tax, and in the following two years, they will have to start producing at least one of five essential parts in the country. The five essential parts are batteries, battery management systems, traction motors, drive control units and air-conditioning systems.
Mitsubishi Electric is currently the only producer and exporter of air-conditioners for EVs in Thailand.
On-board chargers are another core EV technology, but BOI decided not to include them in the list of essential parts, since there is already a producer in the country, Delta Electronics (Thailand), Ajarin said.
Supot Teachavorasinskun, dean of Chulalongkorn University’s faculty of engineering, said that while just a year ago people were still questioning whether EVs would really happen, now the momentum had changed to when, not if, they will be in use.
“EVs and renewable energy, we believe both will certainly happen,” he said.
Battery prices have shrunk from US$1,000 per kilowatt-hour in 2010 to $300 at present, and if they reach $100, it would make EVs much cheaper, since batteries constitute half of an EV’s cost, said the engineering dean.
Piengjai Kaewsuwan, Nissan Motor Thailand vice president for government relations, said the energy cost per kilometre of EVs was only one-third of internal-combustion-engine (ICE) automobiles. Studies by Thai electricity authorities also confirm the cruising cost of an EV here is under Bt1 per kilometre.
“It is unbelievable that now PTT is interested in putting charging facilities inside their petrol stations. Therefore, facilities to support EVs in the future should not be a concern,” she said, adding that Nissan also planned to develop charging infrastructure.
However, executives from Toyota and Mercedes-Benz told the seminar that hybrid electric vehicles were the most appropriate technologies at the moment.
PTT’s chief operations officer for the Downstream Petroleum Business Group, Sarun Rungkasiri, said many technologies that used to be obstacles for EV development had been overcome and EVs had now started to be competitive with ICE vehicles.
“It’s inevitable in the future. [The only question] is when. The whole system – government, the private sector and infrastructure – will contribute to this transition: how it will be, and if it will be smooth or not,” he said.

Siam Makro yesterday reported to the Stock Exchange of Thailand that the company had acquired major stakes in a number of food businesses in Singapore, Hong Kong and Dubai with combined value of Bt3 billion.
The company told the SET that in accordance with a resolution of its board of directors on August 8, its wholly owned subsidiary Siam Food Services Ltd had entered a sale and purchase agreement dated October 31 to acquire 80-per-cent interests in certain companies engaged in food services.
Siam Makro executives declined to reveal any details about the acquisition deals.
The companies involved are Indoguna (Singapore), Indoguna Dubai, and two businesses incorporated in Hong Kong, Lordly Company and Just Meat Company. Total transaction value is about 117.6 million Singapore dollars (just under Bt3 billion).
The company’s sources of funds for the acquisitions are its own capital and a credit facility from a financial institution.

CABINET APPROVES PEA PROJECT
The Cabinet yesterday gave a green light to the Provincial Electricity Authority (PEA) to proceed with the first phase of its transmission and distribution system development project with investment worth Bt62.68 billion.
Nattaporn Jatusripitak, an adviser to the commerce minister, said that of the total investment, Bt47.01 billion would be financed by local borrowings and Bt15.67 billion from the PEA’s earnings.
The project aims to increase capability in distribution of electricity to cope with higher demand, he said.
Meanwhile, the Cabinet also approved a corporate-income-tax waiver for companies or juristic persons who install electronic data capture (EDC) to increase the efficiency of Thailand’s national e-payment programme, Kobsak Pootrakool, vice minister for the Office of the Prime Minister, said after the Cabinet meeting yesterday.
For fees paid to EDC-providing banks, merchants can ask for a double tax deduction. Merchants who buy a new EDC device can seek a tax deduction on its depreciation.
The tax incentive is aimed at promoting electronic payment.
Under the second phase of the national e-payment scheme, EDC expansion, there should be 2 million EDC points nationwide, but there are only 300,000 so far.

NEW VIETJET ROUTES
VietJet has launched two new routes departing from Vietnam’s capital city, Hanoi, to Taipei and Hue, an ancient city in central Vietnam.
The latest routes have been introduced in response to increasing demand from tourists and other individuals.
The introduction of the new flights will also serve the Thai outbound market, offering convenience to passengers wishing to travel to Hanoi and then on to other destinations in Vietnam and Taiwan.

The JSCCIB expects exports to decline more slowly than the previous forecast of a 0-2-per-cent contraction to a 0-1-per-cent drop this year.
It also expects exports next year to grow by 0-2 per cent, which is still slight, as global economic growth should remain fragile, particularly in Europe and China.
The United States is an exception, as its economy is expected to recover next year after the presidential election.
Isara Vongkusolkit, chairman of the meeting and of the Board of Trade of Thailand, said the global economy was still shaky and could cause slow global trading.
Many factors could affect global trading and Thai exports. For next year, the Thai economy is projected to expand by |3.3-3.5 per cent, slower than 3.5-4 per cent estimated for this year.
The Thai economy might shrink slightly this quarter, |but that should not affect |the whole year’s growth, as tourism has continued to outperform to drive gross domestic product.
Nopporn Thepsithar, chairman of the Thai National Shippers Council, said the trade group also looked for stronger export growth next year at 0-1 per cent, turning around from the expected shrinkage of 0-0.8 per cent this year.
Factors that could influence the country’s exports are slow global economic growth, continuing low world oil prices, low prices of commodities, uncertainty over US interest rates, impacts from foreign-exchange speculation, non-tariff barriers, international political conflicts, Thai exporters’ ability to adjust, and the increasing trend of free-trade agreements.

The transformation’s implementation is “in full swing all around the world”, said the PwC report “Industry 4.0: Building the Digital Enterprise”.
The term “Industry 4.0” refers to the fourth industrial revolution. It focuses on the end-to-end digitisation of all physical assets and processes as well as integration of value-chain partners into digital ecosystems. Data and analytics are a core capability for Industry 4.0.
The PwC report is based on a poll of more than 2,000 participants from nine major industrial sectors. The study was conducted across 26 countries.
About one-third of the companies surveyed rate their level of digitisation as high. This value is expected to rise on average to 72 per cent from 33 per cent within the next five years.
Leaders of industrial compa-|nies are now digitising essential functions within their internal |vertical value chain, as well as with their horizontal partners along the supply chain. They are also boosting their product portfolios with digital functionalities and introducing innovative data-based services.
Vilaiporn Taweelappontong, lead partner for consulting services at PwC Thailand, described how Industry 4.0 uses smart technology and real-time data to increase productivity and reduce costs.
“Over the next five years, we expect companies to increase additional revenues by an average of 2.9 per cent per year and reduce costs by an average of 3.6 per cent annually. In absolute terms, this corresponds to [US] $493 billion in increased annual revenue per year and $421 billion in cost savings,” she said.

Big impact
Global industrial sectors will invest $907 billion (Bt31.7 trillion) per year through to2020 to embrace Industry 4.0, the report says.
A major focus of these investments will be on digital technologies like sensors or connectivity devices, and on software and applications such as manufacturing execution systems. In addition, companies are investing in training employees and driving required organisational change.
More than half, 55 per cent, of these companies expect their investments to yield a return within two years, given an investment of around 5 per cent of their digital revenue.
More than 80 per cent of companies expect data analytics will have a significant influence on their decision-making processes within five years. While they feel confident in acquiring the necessary technology, these businesses see challenges in the lack of internal digital culture, vision and training – as well as in a lack of specialists.
For example, almost 40 per cent of companies rely on the analytics expertise of individual employees rather than having a dedicated data analytics department.
The study also says that data security is prerequisite for successful digitisation.
“Strong risk management and data integrity systems can help businesses avoid breaches and manage disruption to operations better,” Vilaiporn said.
Although companies worldwide are pressing ahead with Industry 4.0, the study shows that the level of digital integration will be broadly comparable among all regions in five years, with Japan, Germany and the United States at the forefront.
Companies in Japan and Germany are the furthest along in digitising internal operations and partnering across the horizontal value chain. In the US, new business models are emerging as companies move quickly to digitise their product and service portfolios.
Manufacturing companies in China are focusing on reducing costs to hold up better against international competitors.

He said most of the ministry’s investments in fiscal 2017 would be continuations of projects from fiscal 2016 and those that were unable to attain their targets this fiscal year. Next week, the ministry will report such problems to the Cabinet, he said.
The four high-speed-rail projects that are not expected to achieve their targets this fiscal year will be included in the 2017 plan. These are the Bt179-billion 252.5-kilometre Bangkok-Nakhon Ratchasima route, the Bt224-billion 382km Bangkok-Phitsanulok route, the Bt152-billion 193.5km Bangkok-Rayong route, and the Bt94.6-billion 165km Bangkok-Hua Hin route.
The ministry will today (Nov 1) propose to the Cabinet three double-tracking projects, Arkhom said. They are the Bt24.84-billion 148km Lop Buri-Pak Nampho route, the Bt20.04-billion 165km Nakhon Pathom-Hua Hin route, and the Bt10.30-billion 190km Hua Hin-Prachuap Khiri Khan route.
Also included in the 2017 plan are nine double-tracking projects. They are the 90km Hua Hin-Prachuap Khiri Khan route, 309km Chira Junction-Ubon Ratchathani route, 174km Khon Kaen-Nong Khai route, 167km Chumphon-Surat Thani route, 339km Surat Thani-Songkhla route, 45km Hat Yai-Padang Besar route, 217km Denchai-Chiang Mai route, 326km Denchai-Chiang Rai-Chiang Khong route, and 335km Ban Phai-Nakhon Phanom route.
Other projects are two extensions for the Skytrain Green Line – the Bt11.99-billion 7km Khu Khot-Lamlukka route and Bt13.70-billion 7km Samut Prakarn-Bangpoo route – and one motorway project, the Bt80-billion 119km Nakhon Pathom-Cha-am route.