ท่านสามารถอ่านและดาวน์โหลดเอกสารได้จาก Daily240129_TContinue sour if falls below 1360Market todayA weakening SET has support at 1360, which is a following point. If it falls below this, indicators will continue negative with next support at a previous low of 1353. The upper bound is limited at resistance at 1380. If the index can break through this, it will be a sign of recovery with the next resistance at 1386.Today’s highlights• US Core PCE index for Dec increased 2.9%YoY and 0.2%MoM, lower than expected and below the 3% mark for the third consecutive month. This supports the likelihood interest rates will be stepped down this year.
• China reported an increase of 16.8%YoY in industrial profit for Dec, but this declined 2.3% for 2023, totalling 7.69 trillion yuan.
• A US military base in Jordan was attacked by drones, killing three US soldiers. President Biden announced retaliatory measures, raising concerns about escalating tensions in the Middle East.
• Intel Corp stock sank after the company's projection of lower-than-expected profit and revenue for 1Q24.
• On Jan 28, Thailand and China signed a visa exemption agreement, effective from March 1, 2024. This agreement allows for visa-free travel for stays up to 30 days. It aims at boosting tourism, the economy, and investment between the two countries.
• Thailand's Department of Foreign Trade reported total value of border and cross-border trade in 2023 of ~Bt1.74tn, a decrease of 2.6%YoY, due to a slowing economy in Laos, ongoing conflict in Myanmar and a slow recovery in Cambodian consumption.
• The Thai Furniture Industry Association expects a contraction of 10% in 2024 due to continued slow domestic demand, consumer delays in new furniture purchases in favor of old items, a stagnant real estate market, and competition from lower-priced ASEAN market products.Strategy today In the short-term global stock markets will move up as economic figures and profit are good as expected and less hopes the Fed will cut interest rate. The FOMC meeting this week is expected to show no signal of cutting interest rate in March. The Thai stock market is expected to be pressured by concerns on weak 4Q23 profit for Thai companies and the lack of a new catalyst. The strategy is “defensive and accumulate fundamental stocks to wait for the market recovery”.Trading todayWeekly portfolio: In the short term the SET will be pressured by 4Q23 operating results, which are expected to be weak, and the lack of a new catalyst. We recommend “accumulate defensive and fundamental stocks to wait for the market recovery” in three main themes:
1) Short-term investors (3-4 months) who want to invest in high-quality dividend stocks during dividend season, for stocks going XD between Mar–May 2024, expecting yield on 2023 (after deducting interim dividend) of over 5% - AP, BCP and KTB. For long-term investors who want to invest in high-quality dividend stocks to consistently generate cash flow, with dividend yield expected at over 5% on 2024 - AH, AP, BCP, KTB, PTT and TTB.
2) Investors who are concerned about market fluctuations are recommended to invest in defensive stocks that are expected to beat the market with beta below 1 and price has outperformed the SET YTD – ADVANC, AOT, BDMS and TISCO.
3) Long-term investors are recommended to invest by DCA accumulation as this is seen as good timing after the SET has fallen significantly and risk is low, while stock prices are undervalued – BBL, BDMS, BEM, CPALL, PTT and SCC, all of which are in SET100 and are leaders in their industries with ESG ratings of AAA and AA, valuation lower than 10-year historical average and strong operating results.
In the medium term we recommend being cautious on stocks that are set 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 BTG).Daily top picksAOT: The company will have a short-term catalyst from the visa-free travel arrangement between Thailand and China. 1QFY24 (Oct–Dec 2024) core profit is expected to significantly grow YoY and 54%QoQ, while it is currently trading at PEG of 0.2x, lower than average PEG of 0.3x for regional peers. Recommended to buy for trading at a price not above Bt60.50/share.
TOP: 4Q23 net profit is expected to be Bt2.7bn, significantly improved YoY and pushing 2023 net profit to beat the market and our expectations. 2024 net profit is expected to remain solid on strong market GRM and PX product spread. The present valuation represented by PBV 2024 is 0.6x (-1.6SD of 5-year historical average), with dividend yield expected at ~6%.Today’s reportsBTG – Preview 4Q23F: Losses to continue
KBANK – 2024 guidance: Mostly in line with INVX
OSP – Preview 4Q23F: Pressured by extra losses Click here to read and/or download file Daily240129_E |
