The SET is expected to drift lower. Investment sentiment is pressured by a rebound in crude oil prices after the US launched strikes on Iranian targets for the first time in a month. Additionally, US Treasury yields moved higher as markets increased the probability of a Fed interest rate hike at its September meeting. Short-term capital flows also show net outflows. However, upstream energy, banking, and life insurance stocks are expected to advance and cushion the market. Key factors to monitor this week include potential government economic stimulus measures and US labor market data. Technically, the index broke below its previous low, signaling a short-term negative indicator.
Markets
Face short-term sentiment
Today's highlight
• The Fed Chair reaffirmed the commitment to bringing inflation down to the 2% target, The market interpreted the stance as hawkish, pushing the 10-year bond yield up to 4.73%. This presents short-term negative sentiment for risk assets but is positive for banking and life insurance sectors (BLA, TLI, BBL, KBANK, KTB).
• Brent crude rose 2% after US forces launched strikes on Iranian rocket sites in the Strait of Hormuz following reports that Iran was preparing to deploy naval mines. Marking the first operation in a month, creating short-term positive sentiment for energy plays (PTTEP, TOP, SPRC, BCP).
• The government is accelerating a comprehensive overhaul of auto excise tax structures. Additionally, the Prime Minister instructed the Ministry of Finance to expedite tax incentives to counter production shifts to Indonesia, with details expected in September. Long-term positive for industrial estate and automotive sectors (WHA, AMATA, SAT, STANLY, AH).
• The special committee is set to submit the draft FY2027 Budget Bill to the House of Representatives for its 2nd and 3rd readings during Sep 7–9, with enactment expected by Oct 1. This will ensure public investment disbursements stay on schedule, serving as positive sentiment for contractors and construction materials (STECON, CK, SCC, SCCC).
• Public hearings for the draft PDP2026 are scheduled for Sep 8, with initial details setting clean energy target at 65%, developing Smart Grids, supporting bidirectional power trading, and upgrading transmission lines for EV and Data Center growth. Long-term positive for power producers (GULF, GPSC, BGRIM, GUNKUL, WHAUP).
Strategy today
In the near term, we expect the SET to trade sideways. While the market draws domestic support from expectations around continued government economic stimulus measures — including solar rooftop installation subsidies, tourism stimulus scheme, progress on the FY2027 Budget Bill, and clarity on the PDP2026 plan — headwinds persist from slowing fund flows, the prolonged Middle East situation, and hawkish signals from the Fed Chair at Jackson Hole signaling readiness to raise rates to contain inflation. The investment strategy is therefore "Selective Buy".
Trading today
We view the SET as likely to trade sideways. While the market draws support from expectations around domestic economic stimulus measures under consideration, it continues to face headwinds from slowing fund flows, the prolonged Middle East situation, and hawkish signals from the Fed Chair signaling readiness to raise rates to contain inflation. Our investment strategy is therefore "Selective Buy" across 4 trading ideas with specific positives as follows:
1. Policy plays — Stocks positioned to benefit from progress on government economic stimulus measures: Thai Teaw Thai Plus (ERW, CENTEL, AWC, CPALL, CPN); clean energy support measures including solar rooftop initiatives and the PDP2026 outcome (GULF, GPSC, BGRIM, GUNKUL, WHAUP, AMATA, WHA); and accelerated government disbursement ahead of fiscal year-end and the FY2027 Budget Bill (STECON, CK, SCC, SCCC).
2. Consumption plays — Stocks set to benefit from a recovery in purchasing power and an increasingly resilient domestic economy: commerce (CPALL, CRC, CPN, GLOBAL), telecommunications (TRUE), financials (MTC, SAWAD, TIDLOR), and land transport (BEM).
3. Laggard plays — Stocks whose share prices have lagged the broader SET despite 2H26 earnings momentum expected to deliver solid YoY and HoH growth, making them likely targets for speculative rotation: AP, PR9, SAWAD, HMPRO, BDMS, TU, BCH, MTC, TIDLOR.
4. High dividend plays — To generate steady cash flow returns through interim dividend capture, with expected Div. Interim Yield >2%: TTB (XD Sep 7), BCP (XD Sep 7), OR (XD Sep 7), HMPRO (XD Sep 8), KKP (XD Sep 9).
Daily Top Picks
BCP: Short-term catalyst from Middle East tensions driving up crude oil prices, while refinery margins (GRM) remain high. The company is diversifying into comprehensive businesses such as SAF, trading, upstream energy, and energy infrastructure, while offering an attractive dividend yield of 7%. Short-term TP is Bt56.75.
KKP: Supported by strong surge growth in fee income, serving as a new S-curve from its subsidiary "Dime" and banking operations. 2026 earnings are expected to grow 37%, followed by 14% growth in 2027. The bank recently declared an interim dividend of Bt3.25/share, going XD on Sep 9, 2026. Short-term TP is Bt122.00.