|
ท่านสามารถอ่านและดาวน์โหลดเอกสารได้จาก Daily240816_T
|
Positive in the short term, upper bound is limited
|
| Market today |
|
The SET is expected to move up upon a vote for the new Prime Minister and positive sentiment from US markets. However, uncertainty in politics still exists, limiting the upper bound at 1300 and 1310; the lower bound is at supports of 1280, where a fall below will be negative, and 1270.
|
| Today’s highlights |
• Today at 10 am, the MPs will vote for Prime Minister. Coalition parties have agreed to support Pheu Thai's nominee, Paetongtarn Shinawatra, as 31st Prime Minister.
• The Ministry of Industry says that global sugar prices are expected to remain at no more than US$0.21/lb in 2H24 due to increased sugar production in Brazil. If India changes its policy to allow normal sugar exports, it will lead to an accumulation of sugar in the global market.
• The Ministry of Finance announced it will proceed with selling Vayupak Fund units to general investors as per the original plan approved by the cabinet. The investment value is Bt100-150bn, with an initial allocation of about 30% to retail investors with a unit price of Bt10. Today, it will determine the rate of return.
• Thai food exports in 6M24 reached Bt852bn, a 9.9% increase, led by growing demand for Thai food products in the global market and the softening of many key raw material costs for processing, such as tuna, sugar, soybeans, corn, and wheat.
• US retail sales in July grew 1%MoM, stronger than expected. The number of initial jobless claims decreased by 7,000 to 227,000 in the past week, lower than market predictions.
• China reports steel production in July decreased by ~9% both monthly and annually to 82.94mt, which is the lowest reported figure in 2024. This is due to sluggish demand forcing significant production cuts in the industry.
• Financial Times reports Japan's SoftBank has decided to cancel plans to collaborate with Intel in producing AI chips to compete with Nvidia. Instead, it is considering negotiations with Taiwan's TSMC.
|
| Strategy today |
|
In the short term, the SET is seen to continue fluctuating on political confusion after the prime minister and his cabinet were removed from office by the Constitutional Court. Worries now focus on who will take the helm and what will happen to PM Srettha's economic policies. However, there is hope the Thai capital market will be aided in recovery by the start of fund inflows into EMs. Our strategy is "selective buy".
|
| Trading today |
|
The Thai capital market is expected to fluctuate on political issues. However, there is hope for more fund inflows, now seen to be starting to flow back to EMs. We recommend "Selective Buy" with four main themes:
1) Earnings plays: strong profit momentum, with 3Q24 profit expected to grow YoY and QoQ and expected to grow YoY and HoH in 2H24, while valuations are attractive - DELTA, GULF, KCE, TU, BTG, BDMS, TRUE and BEM.
2) For risk-averse investors who want to generate cash flow from their portfolio, we suggest dividend stocks for a short-term investment - BCP and OSP, both expected to pay a 1H24 interim dividend with yield of 2%.
3) Stocks expected to benefit from the adjustment of ThaiESG conditions that will raise the maximum tax reduction to Bt300,000 and reduce the holding period to 5 years - ADVANC, AOT, CPALL, BDMS, BBL, KTB and GULF.
4) Brent price has recovered as there continues to be attacks on cargo ships in the Red Sea and on energy infrastructure in Russia, although the Middle East conflicts remain fairly contained. We expect the price to be at US$80-90/bbl. Oil stocks are good as a hedge against risk. For high-risk takers, we recommend an upstream oil stock - PTTEP.
|
|
Daily top picks
|
|
DELTA: 2H24 profit is expected to continue growing, backed by growing sales of AI-related products, while there is upside from its own development of AI-related power supply products, which means it will not have to pay technical fees to DELTA Taiwan. Recommend to buy for trading at not higher than Bt103.50/share.
BTG: In the short term, sentiment is bolstered by increasing local swine price. 3Q24 profit is expected to improve, growing QoQ on seasonal factors and YoY on higher margin from a rise in local livestock prices to a one-year high at the same time animal feed cost is at low levels in 3Q24TD.
|
|
Today’s reports
|
|
BCH - 2Q24: Below estimates on SC write-off
CHG - 2Q24: Below estimates on extra item
CRC - 2Q24: Core profit misses estimates
KEX - 2Q24: Weak results, challenges ahead
PSH - 2Q24: Plunged YoY but jumped QoQ
SCCC - 2Q24: Recovery YoY but weaker QoQ
SPRC - 2Q24: Net profit beats estimates
|
| |
| Click here to read and/or download Daily240816_E |
|
