ท่านสามารถอ่านและดาวน์โหลดเอกสารได้จาก Daily231201_T May make a new low if 1370 cannot hold |
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Market today | The SET recovered from support at 1370, but overall signal is still weak. The index is at risk of a continued decline: if it falls below 1370 IT may dive under 1366 and make a new low with a new support of 1360. The upper bound is limited at 1392. A break-through would be a good sign. | Today’s highlights | • Overall U.S. PCE index in Oct increased by 3.0%YoY, while the core PCE index, which excludes food and energy, rose 3.5%YoY. This slowdown from Sep is leading to anticipation the Fed may end its cycle of raising interest rates.
• China's Manufacturing PMI in Nov contracted for the second month and was lower than expected, signalling China's economy has not yet emerged from the crisis and may prompt the Chinese government to implement additional economic stimulus policies.
• OPEC+ agreed to voluntarily cut oil production by 2mn bbl/day in 1Q24. Brazil will become the newest member of OPEC+ in Jan 2024.
• The Prime Minister will convene a meeting to discuss the electricity tariff for the period from Jan-Apr 2024. Though agreeing that it needs to rise, the adjustment will not reach Bt4.68/unit, in line with the Energy Ministry's statement that the maximum increase is Bt4.20/unit.
• The BoT said the Thai economy in Oct 2023 showed signs of recovery driven by improved private consumption and investment. However, the service sector slowed down due to a decrease in both Thai and foreign tourists, while the value of non-gold exports declined after a significant increase in the previous month.
• OIE revised its projection for Manufacturing MPI in 2023, expecting it to contract by 4.8%, adjusted from the previous forecast of a 4.0-4.5% contraction. GDP for the industrial sector is expected to contract by 3.0%, revised from the initial projection of a 2.5-3.0% contraction. In 2024, the MPI and industrial sector GDP are expected to expand by 2.0-3.0%. | Strategy today | In the short term the SET is expected to be range-bound with no catalyst. MPC meeting on Nov 29 unanimously decided to keep interest rate unchanged at 2.50% as expected, while funds are expected to begin to gradually flow into TESG funds as asset management companies will start selling on Dec 1, which will support the stability of the Thai capital market. Our strategy is selective buy. | Trading today | Weekly portfolio: In the short term the SET is expected to be range-bound with no new catalyst to stimulate investment. We recommend “selective buy” in themes with specific drivers:
1) Big-cap stocks in SET50 expected to be selected as investment targets for the TESG fund being set up for long-term stimulus. We select stocks in the SETESG index with two factors of interest: 1) ESG rating of “AAA” or “AA” and 2) prices are down more than the SET YTD – SCGP, OR, CPALL, BEM, GULF, CRC and HMPRO.
2) Big-cap stocks in SET50 placed in the SETESG with a rating of “AAA” and outperforming the SET YTD, with strong profit and dividend yields greater than 5% - PTT and KTB.
In the short term we recommend being cautious on stocks that are expected to be significantly affected by the planned raise in the minimum wage, set to be discussed in the Dec 12 cabinet meeting: Courier Services (KEX), Food (CPF, ZEN, GFPT, TU and AU), Real Estate (LPN, PSH, SPALI, SIRI, QH and AP) and Electronic Components (HANA and KCE). In the medium term we recommend being cautious on stocks that are expected to be affected by El Nino, which will erode purchasing power in the agricultural sector: Finance (MTC, SAWAD), Automotive (SAT, STANLY), Beverages (CBG has high sugar cost) and Food & Agriculture (CPF GFPT and GFPT). | Daily top picks | HMPRO: This stock has been included in the SETESG index with an AA rating. 4Q23 is expected to be the best quarter of the year, and in 2024 it is expected to be the biggest gainer from the E-refund measure due to higher ticket average than others in sector, price has yet to reflect the bonus from E-refund.
BDMS: This stock has been included in the SETESG index with an AA rating. 4Q23 core profit is expected to grow YoY, bringing 2023 core profit growth of 12%, followed by 8% growth in 2024, backed by growing foreign patients, higher revenue from increasing excellence centers and better asset utilization rate. | Today’s reports | HMPRO (High conviction) – Best plus from E-refund scheme | | | Click here to read and/or download file Daily231201_E |
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