ท่านสามารถอ่านและดาวน์โหลดเอกสารได้จาก Daily231207_T Monitoring and waiting for break-out |
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Market today | The SET has recovered, but there is a significant resistance at around 1398, which must be broken through first for a positive signal for continued recovery. Next resistance is at 1410, while support is at 1380. A fall below this could turn into a negative signal, with the next support at 1370. | Today’s highlights | • US ADP non-farm payroll for Nov increased by 103k, less than expected, indicating a cooling of the US labour market.
• The US trade deficit in goods and services in Oct increased 5.1% to US$64.3bn, higher than market expectations.
• EIA reported an increase in last week's gasoline inventories of 5.4mn barrels, more than expected, indicating a slowdown in US fuel demand.
• Putin has arrived in the UAE as a stopover before flying to Saudi Arabia in his first Middle East visit since the start of the Ukraine war. He is expected to primarily discuss energy matters.
• Moody's Investors Service downgraded the outlook for eight Chinese banks from stable due to debt concerns and also lowered the credit outlook for Hong Kong and Macau.
• The JSCC predicts a GDP growth of 2.8-3.3% in 2024 assuming the digital wallet measure with a budget of Bt500bn. The JSCC has advised the government to delay increasing electricity prices as the economy remains fragile, which could lead to a 5-10% increase in product prices and to set up an energy committee to resolve problems in the energy system.
• The Excise Department reported that over 74,000 vehicles have utilized this year's EV purchase subsidy, with the government subsidizing over Bt4bn. Next year's budget is set at Bt17bn, with the program expected to exceed Bt40bn over four years due to increasing demand.
• The banking sector has accelerated debt restructuring to assist debtors before the end of the BoT’s relief measures this year. The Credit Bureau expects debt restructuring to exceed Bt1trn, with a significant number of car and home loans downgraded. | Strategy today | In the short term the SET is expected recover on expected fund flows into TESG funds that will help stabilize the Thai capital market, with recovery in big-cap stocks after earlier price drops. Our strategy is selective buy. | Trading today | Weekly portfolio: The SET is expected to recover after an earlier fall on expected fund inflows from TESG funds designed to help capital market stability. 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. 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, while also recommend the stock with ESG rating of “A” and down more than the SET YTD – AOT.
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.
3) Those looking for long-term dollar-cost-average (DCA) investment as we see it as the best after a sharp drop in the SET, so risk is low and stock prices are undervalued; on this theme we recommend BBL, BDMS, BEM, CPALL, PTT and SCC, all SET100 stocks and leaders in their industries. They are also included in the SETESG index with ESG rating of “AAA” or “AA” and valuations are below 10-year historical mean with steady profit.
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 | OR: This is an interesting stock in the SETESG Index, rated “AA”. Stock price is down 14.7%YTD, incorporating concerns on government measures to control oil price. 4Q23 core profit will be bolstered by the high season for travel. 2023 net profit is forecast at Bt13.6bn, +31%YoY.
AOT: AOT, rated “A”, has also been included in the SETESG Index. Over the past two weeks price has fallen 13%, incorporating most of the negatives. A price of Bt57-60/share is seen as support. Now would be a good time to accumulate for the long term, as profit is expected to continue to grow. | Today’s reports | KTC – Modest growth with regulatory pressure | | | Click here to read and/or download file Daily231207_E |
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