สวัสดีตอนเช้า - 4 ก.ค. 2567 รีบาวด์ เก็งกำไรงบฯ กลุ่มแบงก์

The SET recovered from its low at 1280-1290, generating a rebound signal. Some buybacks were in banks, which is expected to continue to support the index today on speculation on 2Q24 earnings results. The index is expected to rebound with resistances at 1300 and 1306, while support at 1280-1290 is expected to able to stand.

• US private sector employment in June increased at the slowest rate since January, missing expectations. Wage growth in June was the slowest since August 2021. US services PMI by ISM in June fell to its lowest since May 2020, below market expectations. Factory orders in May fell, contrary to expectations. These weak figures suggest the Fed may cut interest rates at the September meeting.
• EIA reported US weekly crude oil stocks decreased by 12.2mn bbl, more than the expected 680,000 bbl decrease.
• South Korea's president announced tax cuts for companies that increase shareholder returns (increase dividend payments) as part of a corporate value enhancement program.
• The World Bank reduced Thailand's GDP growth forecast for this year to 2.4% from 2.8% due to lower-than-expected exports and public investment early in the year. This does not include the impact of the digital wallet program, which could boost short-term growth.
• JSCCIB is concerned about declining domestic demand for vehicles and real estate. Vehicle production in 5M24 contracted 24%YoY, and home transfers in 4M24 contracted 11%YoY, impacting Thailand's economy. The Bt400 minimum wage increase also affects SMEs.
• The Constitutional Court scheduled its next hearing for July 17 of the request by the election commission move to dissolve the Move Forward Party. The court will wait for the results of evidence examination by the parties on July 9 before proceeding.

In the short term, the SET is still fragile and range-bound as it waits for clarification of domestic politics. There are also issues from overseas: China, EU and US manufacturing and services PMI in June, which are expected to range from stable to up slightly from last month. Our strategy is “Selective Buy”. 

Thai capital market is seen to still be fragile and range-bound while waiting for some political clarity and a new catalyst. We recommend "Selective Buy" with four main themes:
1) Stocks expected to benefit from short covering after the SET implements the uptick rule on July 1 and which also have SETESG ratings between AAA to A - HANA, TOP, BEM, MINT, OSP, BBL, SCGP and AOT.
2) Stocks expected to benefit from changes in conditions for the ThaiESG fund: raising deductions to up to Bt300,000 and reducing the holding period to five years - ADVANC, CPALL, BDMS, BBL and BEM.
3) Global plays whose profit is expected to grow and which benefit from global economic recovery over domestic plays, which face multiple uncertainties - KCE, SCGP, TU and MINT. (We recommend buy KCE and SCGP on price dips upon pressure from weak Chinese economic figures).
4) Tension has eased about the situation in the Middle East, leading Brent down to the lower bound of US$80-90/bbl, which is seen as an opportunity to hedge. For high-risk takers, we recommend an upstream oil stock - PTTEP.

PTTEP: High oil price in the short term is a short-term catalyst. The stock hedges against the risk of conflicts in the Middle East. Profit and balance sheet are strong and 2Q24 profit is expected to be good, backed by high oil price and sales volume. Recommend buy at not higher than Bt153/share.
GULF: 2Q24 core profit is expected to reach a record high and continue growing for the rest of the year, supported by higher capacity. A positive is another two power plant auctions scheduled to take place soon. Valuation is attractive, presently trading at PER of 23x or -1.5 S.D. of its average. Recommend buy at not higher than Bt40.25/share.