ACE – ถูกตลาดมองข้าม Negative in the short term, still limited downside |
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Market today | The SET fell below 1,545 causing a short-term negative indicator; next supports are 1,535 and 1,530. However, the index has limited downside with resistances of 1,550 and 1,555. A break through would be a good sign. Follow US CPI report tomorrow. | Today’s highlights | • The prime minister announced four urgent policies, including bringing GDP growth back to 5% per year and Bt10,000 digital wallet by using blockchain without touching the Vayupak fund. The Ministry of Finance confirms will not take out new loans to maintain fiscal discipline.
• The Ministry of Finance plans to reform the pico-finance loans to increase protection for consumers, especially regarding interest rate and fees. It will hold public hearings between Sep 6-20.
• THAI said it is ready to handle more foreign tourists, both domestic and international, especially Chinese and Indians, which will be coming in more after being allowed visa-free entry.
• The Fed said US consumers are less worried about inflation but are more worried about employment and ability to repay debt.
• European gas price has risen for three days after staff at Chevron’s LNG plants in Australia began a strike after unsuccessful negotiation.
• UBS plans to lay off hundreds of staff in Asia as customer activities and the Chinese economy decline. This will take place a few months after Credit Suisse’s acquisition.
• Jinan and Qingdao, two big cities in the east of China, announced they were lifting controls on home transactions, effective on Sep 11, to stimulate the real estate market.
• GAC from China plans to invest in Thailand to be its manufacturing base for right-drive vehicles, expecting to start producing in the middle of 2024. | Strategy today | The investment climate in the Thai capital market is seen to have limited downside and be range-bound at 1,540-1,600, supported by positive sentiment from the new government’s policy speech on Sep 11-12, stable oil price at a high level, which benefits Energy and the launch of iPhone 15. Economic issues to follow this week are US CPI (expected to be stable) and the ECB meeting (interest rate expected to be flat). Our investment strategy is for "Selective Buy". | Trading today | Weekly portfolio: The SET will be range-bound and has limited downside as there is positive sentiment from the new government’s policy announcement. Our investment strategy is “Selective Buy” in themes with specific drivers:
1) Stocks for medium-term investment: we selected eight stocks across four industries whose 2H23 profit is expected to grow both HoH and YoY - PTT, BCP, KCE, HANA, BDMS, BCH, AOT, and ERW.
2) Speculative stocks expected to benefit from policies deemed “urgent” by the new government with a focus on stimulating purchasing power and tourism – CPALL, CPAXT, HTC and OSP.
3) Speculative stocks expected to benefit from the iPhone 15 launch – COM7 and SYNEX
In the medium term we recommend to be cautious on stocks that are expected to be affected by El Nino, which will erode purchasing power in the agricultural sector: Commerce (GLOBAL), Finance (MTC, SAWAD), Automotive (SAT, STANLY) and Food & Agriculture (CPF and GFPT). | Daily Focus | CPALL: Strong profit momentum. 3Q23 profit is expected to be stable or improve QoQ (opposed to the sector, which is expected to decline QoQ) and grow YoY from higher sales and margin in the convenience store business and higher profit share from CPAXT due to lower financial cost after refinancing.
BCH: 3Q23 core profit is expected to improve QoQ and reach this year’s high in 4Q23, supported by a seasonal increase in domestic patients, higher revenue from foreign patients and a 10% rise in social security payment per head since May 1, 2023. | Today’s reports | ACE – Overlooked by the market |
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