Sideways up despite lacking fund flow

The SET is expected to move sideways-up. US Treasury yields remain elevated, while crude oil prices stabilized as short-term supply shortage concerns eased. However, the market still lacks clear positive drivers, and foreign investors were net sellers of Thai equities for 11 consecutive trading sessions totaling nearly Bt40bn, warranting caution over potential volatility from profit-taking. Investors are expected to focus on stock-specific opportunities with individual positive catalysts. Technically, the index has rebounded to test its 75-day moving average; a breakout above this level would signal a clearer technical recovery.

Today's highlights
• Reuters reported Middle East crude oil exports recovered to 81% of pre-war levels, averaging 18.6mn bbl/day in September 2026, led by Saudi Arabia rebounding to 6.6mn bbl/day. Short-term negative for upstream energy (PTTEP), but positive for power producers (GULF, GPSC, BGRIM). ‘The World Bank raised Thailand’s 2026 GDP growth forecast to 2.0% (from 1.3%), driven by AI-related product exports, with ASEAN exports (Malaysia, Philippines, Vietnam, Thailand) accounting for 70%. However, it warned of risks from energy import deficits and concentrated agricultural poverty. Positive for overall SET investment sentiment.

• The Cabinet acknowledged the establishment of 8 Special Economic Zones proposed by the EECO to allow investors to utilize EEC tax privileges and facilities (e.g., Amata City Chonburi 2, 304 Industrial Park 2, Map Ta Phut). Long-term positive for industrial estates (WHA, AMATA, WHAUP).

• TPSO reported September 2026 CPI inflation rose 2.82% YoY, accelerating from the prior month on higher fuel, fresh food, and prepared food prices, bringing 9M26 average inflation to 1.54% YoY. Full-year inflation forecast was adjusted to 1.8–2.2%, weighing on living costs. Negative for consumer finance (MTC, SAWAD, TIDLOR) and retail (CPALL, CPAXT).

• The Finance Minister confirmed readiness to host the IMF–World Bank AM 2026 (Oct 12–18), with over 15,000 registrants, positioning Thailand as a global bridge to attract investment relocation. Short-term positive for tourism (AOT, CENTEL, ERW) and long-term positive for industrial estates (WHA, AMATA).

Strategy today
In the near term, the SET is expected to remain volatile due to lack of new supporting factors amid investment atmosphere pressured by multiple headwinds including the Fed's hawkish stance supporting bond yields at multi-year highs causing continued fund outflows, combined with elevated energy prices from prolonged geopolitical issues posing inflation risks. Domestically, overhang from flooding concerns remains, with preliminary impact on the economy assessed as limited, but caution warranted on sudden flooding risks from expected heavy rain Oct 5-7 and Oct 11-13, which could add downside risk to the economy and create negative market sentiment. The investment strategy therefore recommends "Selective Buy".

Trading today
The SET is expected to remain volatile, lacking new supporting factors, pressured externally by the Fed's hawkish stance pushing bond yields higher causing fund outflows, and high energy prices from geopolitical issues increasing inflation risks. Domestically, overhang from monitoring new flooding waves which may add downside risk to the economy and dampen investment sentiment. The investment strategy therefore recommends "Selective Buy" emphasizing "Buy on Dip" through 3 trading themes with specific positive factors as follows:

1. Domestic Play — Based primarily on domestic consumption with stable revenue streams and high resilience to external factors. Includes retail stocks (CPALL, CPN, CRC), healthcare stocks (BCH, PR9), and telecom stocks (TRUE).

2. Flood Defensive & Recovery Plays — Benefit from flooding starting with emergency essential goods buying (BJC, CRC) continuing to post-flood housing repair demand (HMPRO, GLOBAL) and construction materials (DCC). Recommend avoiding or delaying investment in property/casualty insurance stocks that may face pressure from higher loss ratios.

3. Tourism & Mega-Event Play — Expected to benefit from entering 4Q26 high tourism season supported by China's Golden Week (Oct 1-7) and global events like World Bank-IMF meetings (Oct 12-18). Includes tourism stocks (ERW, CENTEL, AOT) and retail stocks (CPN, CRC).

Daily Top Picks
CRC: Short-term catalyst from accelerating SSS growth in September at 4% vs 1.5% in July–August. 3Q26F SSS is expected to deliver the strongest growth in the retail sector, while experiencing limited impact from floods. 3Q26F profit is projected to grow strongly, supported by SSS, margin expansion, and a weaker baht boosting revenues in Vietnam. Short-term TP is Bt31.50.

GULF: Short-term catalyst from improving Middle East energy exports and declining bond yields. The company has continuous business expansion plans through capacity expansion, alongside future growth opportunities driven by Data Center growth, PDP2026, and Direct PPA measures. Short-term TP is Bt60.50.