Market today |
The SET is expected to continue to climb, supported by economic stimulus and fund inflows from foreign buys since yesterday. Follow the policy statement to Parliament today and tomorrow. Supports are at 1410 and 1400, which is expected to stand firm. Resistances are at 1430 and 1435. |
Today’s highlights |
• After the US presidential debate, a CNN poll indicated Kamala Harris beat Trump with a score of 63% to 37% compared to 50-50 before the debate.
• US CPI in August increased by 0.2%MoM, aligning with market expectations. However, Core CPI index rose 0.3%MoM, higher than market predictions. This has led investors to reduce their expectations the Fed will cut interest rates by 50bps.
• Hurricane Francine has led to suspension of production at several offshore oil rigs in US. It is expected to affect oil tankers passing through the Gulf of Mexico next week. As of yesterday, 39% of crude oil production in the Gulf of Mexico had been suspended.
• FETCO and the Association of Investment Management Companies are preparing to ask the Treasury for an extension and adjustment of SSF investment criteria this October to encourage younger people to boost long-term savings. SSF figures at the end of July showed an increase in total AUM of over Bt60bn.
• The Minister of Energy says the end-Sep EPPO meeting will consider global LPG prices and the status of the Oil Fund. The retail price of LPG is expected to be kept at Bt423 per 15kg tank for another 3 months, extended from expiration on Sep 30.
• The president of the Thai Condominium Association reports the condo market still shows no signs of recovery due to weak purchasing power among Thais and a slowdown in the foreign market. They are urging the BoT to relax LTV criteria, cut interest rates and increase the foreign buyer quota to 75%. They also support the idea of entertainment complexes. |
Strategy today |
Although in the short term the SET still has good momentum as the political skies have cleared and new stimulus is expected in 3Q-4Q24, in the past month the index has risen by 10%MoM. Hence, be cautious of profit-taking around resistances of 1450-1460. Funds are expected to switch to flow out from banks, financial firms and ICT, and flow into petrochemicals, utilities, property development and healthcare. Externally, there is still the risk of recession, which is slowing inflation and is expected to lead to an interest rate cut by the Fed and ECB. Our strategy is "selective buy". |
Trading today |
Although the SET still has good momentum for the short term, be wary of profit-taking after the leap in the index over the past month. We recommend "Selective Buy" with four main themes:
1) Investors who want to speculate in stocks that have signs of a turnaround and attractive valuation, trading at PER and PBV lower than -1SD - CPN, GPSC and TFFIF.
2) Investors who want to speculate in stocks expected to benefit when the interest rate cycle starts down - leasing (MTC), commerce (CPALL and CPAXT), utilities (GULF) and REITs (LHHOTEL and DIF).
3) Stocks expected to benefit from short-term stimulus packages from the new government in September, particularly those related to consumer staples - CPALL, CPAXT, BJC, TNP and CBG.
4) Stocks expected to benefit from the Vayupak Fund. We highlight stocks in SET100 that have: 1) good dividend yield, minimum of 3.5%, 2) SETESG Ratings between A and AAA and 5-star CG and 3) strong financial position, with profit expected to grow in 2025 - KTB, BBL, BCP, ADVANC and HMPRO. |
Daily top picks |
DELTA: 2H24 profit is expected to grow HoH and YoY from rising sales of AI-related products and upside from development and sale of power supply related to AI developed by DELTA Thailand, avoiding the technical fees paid to DELTA Taiwan. Recommend buy for trading at not higher than Bt103.00/share.
WHA: Things look good through 2025, with profit expected to grow 12.7% in 2024, and 16.2% in 2025, driven by FDI and growing BoI-backed buyers through 2024. WHA are positioned to gain the most benefit compared to peers. Recommend buy for trading at not higher than Bt5.65/share. |
Today’s reports |
PTTGC - Another overhang lifted
WHA - Raises 2024F land sales target |
