PTT Global Chemical Plc (PTTGC) is developing a merger-and-acquisition plan with a focus on businesses where it still has production lines, said chief executive officer Kongkrapan Intarajang.
The M&A plan will become clearer as the year progresses, he added.
He explained that the Covid-19 fallout meant some companies were now considering selling businesses at low prices, opening opportunities for M&A deals.
PTTGC is expected to invest between Bt30 billion and Bt50 billion this year on business development. However, this amount does not include the M&A budget.
Coca-Cola severs longtime ties with pro-sugar industry group
CorporateJan 14. 2021Delivery trucks sit parked outside a Coca-Cola Co. bottling plant in Lexington, Ky., on Feb. 10, 2020. MUST CREDIT: Bloomberg photo by Luke Sharrett.
By Syndication Washington Post, Bloomberg · Brett Pulley
Coca-Cola Co. has ended its long association with the International Life Sciences Institute, a blow to the powerful food organization known for its pro-sugar research and policies.
The beverage giant ended its membership at the “global, regional and country level” as of this month, Coke said in a statement in response to inquiries from Bloomberg News. The decision was made after a routine review, the company said without offering additional details.
The departure is a major setback for ILSI at a time when health-conscious consumers are increasingly turning away from sugar-laden beverages. The group, which was created in 1978 by a former Coke executive, still lists companies such as PepsiCo, Kellogg and McDonald’s as members, but Coke had been a prominent supporter and financial backer.
Those companies didn’t immediately respond to a request for comment on whether the group’s membership list is up to date. ILSI didn’t respond to requests for comment.
ILSI has come under fire in recent years for its role in influencing government health and nutrition policy around the world, acting as what some scientists and health experts have called an advocacy-oriented front group for its corporate members. The group has promoted the industry-friendly idea that physical exercise, not a change in diet, is how to combat obesity, according to a 2015 New York Times report. It has exerted influence around the world, including in a multidecade effort in China that was detailed in the Journal of Health, Politics, Policy and Law, as well as in India and Brazil.
Citing the growing criticism, candy maker Mars left the organization in 2018, and Nestle exited at the regional and country levels in January of last year.
Coke made the decision last year to sever ties, Mark Preisinger, the company’s director of corporate governance, said in an October letter viewed by Bloomberg that was sent to the Park Foundation, a non-profit organization that has been critical of ILSI.
Corporate Accountability, a watchdog group that also has called out ILSI, said the move suggests Coke now sees “more risk than reward” in sticking with the organization.
“For decades, ILSI has been Coca-Cola’s accomplice interfering in and blocking policies that aimed to safeguard people’s health and wellbeing across the world,” Ashka Naik, research director at Corporate Accountability, said in a statement.
Coke’s shares were little changed at 11:25 a.m. in New York. The stock fell 0.9% last year amid pandemic-driven closures of sporting arenas, amusement parks and other venues, and the company has cut jobs.
CorporateJan 13. 2021Acting THAI president Chansin Treenuchagron
By The Nation
Thai Airways International (THAI) on Wednesday insisted its rehabilitation plan is progressing without interruption under Bankruptcy Court supervision.
The announcement came after the court granted THAI’s request to extend the deadline for submission of the plan from January 2 to February 4.
Acting THAI president Chansin Treenuchagron explained the rehab plan involved many creditors and complex issues that required consultation from experts and professional advisers before its submission.
The court approved the airline’s rehabilitation petition on September 14 last year and appointed seven rehab planners nominated by the airline.
Chansin said the planners were making good progress, while THAI management and staff were cooperating towards their efforts.
The Stock Exchange of Thailand (SET) Index fell by 0.78 points, or 0.05 per cent, to 1,546.53 in the morning session on Thursday.
An analyst at Krungsri Securities expected the day’s index to fluctuate between 1,535 and 1,560 points as investors keep an eye on US President-elect Joe Biden’s economic stimulus proposals, the US political situation after the House of Representatives impeached President Donald Trump and banks’ 2020 turnover results set to be announced.
“Besides, the decline in foreign fund flows would cause index volatility,” he said.
He recommended investors buy:
> Shares related to green energy and electric vehicles, such as EA, GPSC and KCE.
> PTTEP, PTTGC, Top and IVL, which benefit from a rising oil price and improved fourth-quarter performance.
> PSL, TTA and RCL, which would benefit from a rise in the freight rate.
The SET Index closed at 1,547.31 on Wednesday, up 7.46 points, or 0.48 per cent. Total transactions amounted to Bt106.7 billion, with an index high of 1,561.66 points and a low of 1,542.42.
The price of gold dropped by Bt100 per baht weight in morning trade on Thursday, the Gold Traders Association reported.
As of 9.23am, the buying price of a gold bar was Bt26,150 per baht weight and selling price Bt26,250 while gold ornaments cost Bt25,681.04 and Bt26,750, respectively.
At close on Wednesday, the buying price of a gold bar was Bt26,250 per baht weight and selling price Bt26,350 while gold ornaments cost Bt25,772 and Bt26,850, respectively.
The spot gold price moved to US$1,845 (Bt55,403) per ounce in the morning, while the Comex (Commodity Exchange) gold price to be delivered in February rose by $10.70 to $1,854.90 per ounce on Wednesday, thanks to mass buy-ups of safe-haven assets to deal with inflation after the US Consumer Price Index increased in December.
Also, gold gained positive sentiment from hopes of a rollout of fresh US economic stimulus measures.
The Hong Kong gold price meanwhile dropped by HK$70 to $17,090 (Bt66,188) per tael, the Chinese Gold and Silver Exchange Society reported.
Oil fluctuates with fuel build up dimming tighter crude supply
EconJan 14. 2021An oil pumping jack in an oilfield near Neftekamsk, in the Republic of Bashkortostan, Russia, on Nov. 19, 2020. MUST CREDIT: Bloomberg photo by Andrey Rudakov.
By Syndication Washington Post, Bloomberg · Andres Guerra Luz, Alex Longley
Oil clawed back some of its earlier losses as shrinking U.S. crude supplies added to an already tightening global supply outlook, though a stronger dollar and rising refined products supplies exerted downward pressure.
Futures were little changed in New York after falling as much as 1.2% earlier in the session. An Energy Information Administration report showed U.S. crude inventories fell by 3.248 million barrels last week, its fifth drop in a row. However, the EIA report also showed builds in gasoline and distillate stockpiles. The Bloomberg Dollar Spot Index strengthened as much as 0.3%, reducing the appeal for commodities priced in the greenback.
“It’s good to see another crude draw” and the remainder of the year should “continue to have drawdowns in overall inventories, especially if OPEC compliance remains pretty strong,” said Brian Kessens, a portfolio manager at Tortoise, a firm that manages roughly $8 billion in energy-related assets. Still, “the refined products side was a little bit disappointing for those people who wanted to be more bullish.”
Prices earlier were boosted by expectations for cold weather to buoy demand at a time when the supply outlook has already been tightening, with Goldman Sachs seeing demand getting a boost of at least 1 million barrels a day. In Japan, power generators have been buying cargoes of low-sulfur fuel oil for the purpose of direct burning, according to traders. Meanwhile, Saudi Arabia trimmed February supplies to at least 11 refiners in Asia and Europe after announcing surprise production curbs last week.
Following recent covid-19 vaccine breakthroughs and Saudi Arabia’s pledge to deepen cuts, oil markets still face a precarious demand picture as the world tries to emerge from the pandemic. U.K. road vehicle use was down 42% on pre-covid levels last week, while aircraft tracking in early 2021 shows little sign of any meaningful rebound in flight numbers. However, the market’s been looking ahead of the near-term virus risks and toward demand returning in the longer term.
“We have a positive outlook,” Russell Hardy, chief executive officer of trading house Vitol Group, said in a Bloomberg Television interview. “The market as usual is racing ahead and factoring in that positive news of a vaccine and the expectation of a better summer and a better second half of 2021.”
A trading executive at Total also said Wednesday that by the northern hemisphere’s summer, oil-product demand should be back at 2019 levels, excluding jet fuel. Use of aviation fuel is unlikely to recover until the third quarter, Mike Muller, Vitol’s head of Asia, said Wednesday.
While crude prices should continue “trading higher over the coming months, investors need to be mindful that the road to higher oil demand and prices will remain bumpy,” said Giovanni Staunovo, a commodity analyst at UBS Group.
EconJan 14. 2021A pedestrian stands against an electronic stock board outside a securities firm in Tokyo on Jan. 4, 2021. MUST CREDIT: Bloomberg photo by Noriko Hayashi.
By Syndication Washington Post, Bloomberg · Claire Ballentine, Vildana Hajric
Stocks rose and benchmark Treasury yields retreated for a second day amid optimism the economy will continue to benefit from government support.
Technology shares led gains, with the Nasdaq 100 outperforming the benchmark S&P 500. Intel jumped 7% after the chipmaker named a new chief executive. Treasurys received strong demand for a second consecutive day at a government debt sale, helping to send yields down from the highest levels since March.
“Investors continue to focus on growing expectations for increased fiscal spending and promising economic prospects as the vaccine rolls out later this year,” said Ryan Nauman, market strategist at Informa Financial Intelligence’s Zephyr. “It’s all about resiliency here right now and equity markets continue to overlook and not be phased by all the chaos that’s out there.”
In Washington, the House of Representatives is voting to impeach President Donald Trump for a second time. A Senate trial for Trump probably will not begin before his term ends Jan. 20.
European Central Bank council member Francois Villeroy de Galhau said the ECB will keep an easy stance for as long as needed, and U.S. investors took comfort from remarks by two Federal Reserve officials that pushed back on the possibility of tapering bond purchases anytime soon.
“Coordinated comments from Fed governors” are helping to deflate bond yields, said Deutsche Bank strategists including Jim Reid in a note to clients. “We’ve only had seven business days this year, and we’ve already had a full 360-degree tapering debate played out by the Fed.”
Europe’s Stoxx 600 was flat, with losses in banks and travel shares outweighing M&A announcements. Among the day’s winners, French grocer Carrefour rallied after Alimentation Couche-Tard, the convenience-store giant that owns the Circle K chain, said it’s exploring a transaction.
In Japan, the Nikkei 225 outperformed, reaching a record in dollar terms. Equities also ticked up in South Korea, while Hong Kong shares were flat.
Oil fell as a stronger dollar and rising refined products supplies offset shrinking U.S. crude supplies, capping the price under a key technical indicator.
Here are some key events coming up:
– JPMorgan Chase & Co., Citigroup and Wells Fargo are among firms due to report earnings.
– President-elect Joe Biden plans to lay out proposals for fiscal support Thursday.
– Federal Reserve Chairman Jerome Powell takes part in a webinar Thursday.
– U.S. initial jobless claims data is due Thursday.
– U.S. retail sales, industrial production, business inventories and consumer sentiment figures are due Friday.
These are some of the main moves in markets:
Stocks
– The S&P 500 index climbed 0.3%, to 3,809.84, as of 4:02 p.m. New York time.
– The Dow Jones industrial average increased 0.1%, to 31,060.47.
– The Nasdaq Composite index jumped 0.5%, to 13,128.95.
– The Stoxx Europe 600 index rose 0.1%, to 409.07.
– The MSCI All-Country index rose 0.3%, to 661.44.
Currencies
– The Bloomberg Dollar Spot Index rose 0.2%, to 1,122.79.
– The euro decreased 0.4%, to $1.2157.
– The British pound fell 0.3%, to $1.3634.
– The Japanese yen weakened 0.1%, to 103.87 per dollar.
Bonds
– The yield on 10-year Treasurys dipped four basis points, to 1.09%, the biggest decrease in five weeks.
– Germany’s 10-year yield decreased five basis points, to -0.52%, the largest dip in seven months.
– Britain’s 10-year yield fell five basis points, to 0.307%, the first retreat in more than a week and the biggest drop in more than a month.
Commodities
– West Texas Intermediate crude fell 0.6%, to $52.88 a barrel, the first retreat in more than a week and the largest fall in a week.
The Bank of Thailand (BOT) may cut its benchmark interest rate to a new historic low of 0.25 per cent, Kasikorn Research said on Wednesday. It also warned that households and businesses remain vulnerable to debt, but insisted that Thailand’s banks were still strong amid the second wave of Covid-19.
Thanyalak Vacharachaisurapol, deputy managing director at Kasikorn Research Centre, expressed concern that household debt in the third quarter last year stood at 86.6 per cent of GDP, and is expected to rise above 91 per cent by the end of this year.
High household debt has hit many countries, following low or falling GDP growth amid the pandemic. The Thai government has responded by helping debtors facing liquidity problems, while trying to alleviate household debt levels.
The BOT and financial institutions are implementing additional assistance measures, while extending existing measures such as the debt holiday (until mid-2021) and debt restructuring.
As for the BOT’s benchmark policy rate, KBank forecasts it may fall from 0.5 per cent to 0.25 per cent given the highly uncertain situation, but sees a zero-interest rate as unlikely given the BOT is equipped with other tools to ease financial costs for businesses.
“Regarding the outlook for the baht, although the Thai currency is expected to soften slightly over the next two weeks, from the Bt29.50 per US dollar reported at 2020 year-end due to the US presidential election results and new economic stimulus measures. The baht will likely strengthen during the remainder of 2021 when the market gives more weight to the greenback’s fundamentals, such as the US budget and trade deficits, and the Fed’s quantitative easing programme.
Meanwhile, financial institutions overall are now more robust and have more liquidity than during the 1997 financial crisis, though they remain vigilant towards risks from potential asset-quality problems, said KBank. However, the business and household sectors have become more fragile due to mounting debt and eroding competitiveness. Despite this, KBank views that there are opportunities in every crisis for those prepared in advance and able to grab opportunities when they arrive – for instance, by developing mobile banking, online shopping and food delivery, all of which have been enjoying rising profits during lockdown periods.
Plans to vaccinate half of Thailand’s population against Covid-19 through 2021 and in early 2022 should mean consumer and business confidence, in particular tourism, will bounce back, said Thanyalak. However, she warned they may not recover to pre-pandemic levels in 2022. People are also expected to maintain “new normal” and social distancing habits, such as working from home and using digital communication technology. International travel may take at least 2-3 years to return to normal, she added.
Nattaporn Triratanasirikul, KResearch assistant managing director, said the second wave of Covid-19 differed from the first wave in three aspects. First, the number of daily infections is higher. Second, the infection scope is more extensive. And third, the origin of the outbreak is in the industrial sector. In addition, the government’s control measures are different, with a “non-lockdown” or a partial lockdown employed this time to maintain a balance between economic and public health impacts. However, the daily infection rate must be monitored to see if it decreases or falls to zero within 60 days, he added. “With a faster end to this round of infections, our economic growth may not fall too steeply from KResearch’s previous estimate of 2.6 per cent.”
Transport Ministry wants Bt325bn for 2022 infrastructure plans
EconJan 14. 2021Transport Minister Saksayam Chidchob
By The Nation
Transport Ministry has asked for a budget of Bt325 billion for 2022, of which Bt324 billion is earmarked for 50 infrastructure projects, said minister Saksayam Chidchob.
The remaining Bt1 billion is for upgrading the transport system, he added.
Of the 50 projects, six will be developed by the Highways Department at a cost of Bt240 billion, two by the Rural Roads Department at a cost of Bt28 billion and one by the Expressway Authority of Thailand worth Bt955 million.
The State Railways of Thailand will develop 16 projects (Bt18 billion), the Mass Rapid Transit Authority of Thailand has 13 projects (Bt20 billion), the Department of Land Transport has four projects (Bt818 million) and the Department of Airports two projects worth Bt11 billion.
The strategy for national development under the BCG Model – bio-economy, circular economy and Green economy – was approved by the BCG committee on Wednesday.
The five-year strategy will begin this year.
Prime Minister Prayut Chan-o-cha, who chaired the committee meeting, said the BCG Model will be included in the national development agenda.
The model seeks to capitalise on Thailand’s abundant agricultural products and vast farming zones. It covers the farm, food, health, medical, energy, biochemical and tourism sectors, which account for half of the country’s total employment.
Delivery trucks sit parked outside a Coca-Cola Co. bottling plant in Lexington, Ky., on Feb. 10, 2020. MUST CREDIT: Bloomberg photo by Luke Sharrett.
Acting THAI president Chansin Treenuchagron
An oil pumping jack in an oilfield near Neftekamsk, in the Republic of Bashkortostan, Russia, on Nov. 19, 2020. MUST CREDIT: Bloomberg photo by Andrey Rudakov.
A pedestrian stands against an electronic stock board outside a securities firm in Tokyo on Jan. 4, 2021. MUST CREDIT: Bloomberg photo by Noriko Hayashi.
Transport Minister Saksayam Chidchob
Prime Minister Prayut Chan-o-cha
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