ท่านสามารถอ่านและดาวน์โหลดเอกสารได้จาก Daily240731_T To move between 1300-1320
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Market today | The SET is expected to move between 1300-1320 as investors wait for the FOMC meeting to evaluate interest rate direction. If the index does not fall below 1290, it is expected to continue to move up, with limited upper bound at resistances of 1330-1335. | Today’s highlights | • US JOLTS data in June fell to 8.18mn job openings, higher than market expectations. The US Consumer Confidence Index in July increased more than expected.
• The cabinet approved new criteria for the ThaiESG fund, increasing the tax deduction limit to Bt300,000 and reducing the holding period to 5 years. They expect Bt20-30bn in new investment. They also approved a Bt15bn SME Green Productivity loan measure and tax incentives for skilled Thais working abroad to return and work in 15 target industries, benefiting both employees and employers.
• The Ministry of Finance is preparing to establish a new Vayupak Fund to raise Bt100bn. The Public Debt Management Office will sell Bt40bn worth of government savings bonds for FY2024 (second round) from August 13, with a maximum interest rate of 3.40% p.a.
• The Ministry of Tourism and Sports reported Thailand received over 20.3mn tourists from January 1 to July 28, generating revenue of ~Bt957bn. The top five source countries are China, Malaysia, India, South Korea, and Russia.
• The Ministry of Commerce revised its rice export forecast for this year to 8.2mt after exporting over 5mt tons in 1H24, growth of 25.12%. Supporting this upward revision is increased demand from importers, India's continued rice export controls and a weaker baht that makes Thai rice prices competitive.
• The SET is enhancing its SETESG Ratings assessment, focusing on publicly disclosed information from listed companies. The SEC is preparing to establish a fund to compensate investors, amending laws to use fines from violations to compensate victims, expected to be finalized within 3 years. | Strategy today | In the short term the SET is expected to rebound but with limited upside, awaiting 2Q24 earnings releases, which are expected to show growth, while waiting for clearing of the murky political skies. External factors are also expected to support a rebound after profit-taking in technology stocks last week: the Fed and BoE are expected to keep interest rates unchanged and 2Q24 earnings announcement of US listed companies are expected to be strong; China's economy is weak, and the technology war is expected to escalate. Our strategy is "selective buy". | Trading today | The Thai capital market is expected to rebound but with limited upside, while waiting for clarification of domestic factors and release of 2Q24 earnings. We recommend "Selective Buy" with four main themes:
1) Earnings plays: 2Q24 profit to grow YoY and QoQ and valuations are not expensive - MINT, BEM, OSP, TU, KCE, CPF, TRUE and AMATA.
2) Stocks expected to benefit from short covering after the uptick rule started on July 1, also with strong fundamentals with SETESG Ratings between AAA and A - DELTA, TOP, BEM, MINT and AOT.
3) Stocks expected to benefit from the adjustment of ThaiESG conditions that will raise the maximum tax reduction to Bt300,000 and reduce the holding period to 5 years - ADVANC, AOT, CPALL, BDMS, BBL, KTB and GULF.
4) Brent price has recovered as there continues to be attacks on cargo ships in the Red Sea and attacks on energy infrastructure in Russia, although the Middle East conflicts remain fairly contained. We expect the price to be at US$80-90/bbl. Oil stocks are good as a hedge against risk. For high-risk takers, we recommend an upstream oil stock - PTTEP. | Daily top picks | AMATA: 2Q24 net profit is expected at Bt480mn, growing 53%YoY and 3.5%QoQ. Although gross margin is pressured by a low number of transfers at Amata Chonburi, the company is expected to have extraordinary items from sale of an investment and Bt15.22bn in backlog that will support profit growth in 2H24 and 2025.
BBL: Price has fallen by 7%YTD, which we see as an opportunity to buy. Catalysts are: 1) Lower provisions (credit cost) for the rest of the year, 2) outstanding loan growth, 3) strong NIM and 4) lower cost-to-income ratio. BBL remains our top pick in the banking sector. | Today’s reports | Petrochemicals - Spread rose WoW on lower naphtha price
AOT - Overhang lifted
DELTA - 2Q24: Beats INVX & market by 40%
HMPRO - 2Q24: In line with estimates
MST - 2Q24: Weak as expected
PTTEP - 2Q24: Beat estimates | | Click here to read and/or download Daily240731_E |
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