Thursday, August 13, 2020

SET gains but worries mount about state of emergency

Mar 25. 2020
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By The Nation

The Stock Exchange of Thailand (SET) Index rose by 39.81 points, or 3.85 per cent, to 1,073.65 in Wednesday's (March 25) morning session.

A stock analyst at Krungsri Securities expected the index would move upside between 1,055 and 1,065 before weakening as regional stocks sharply rebounded after the US Federal Reserve used unlimited quantitative easing bond purchase programme and increased the credit line by $300 billion, allowing businesses to borrow at lower interest cost.

“Also, investors hope the US Congress would reach an agreement to relieve the burden of the American people and businesses affected by the Covid-19 impact worth US$2 trillion, which will be a positive sentiment for risk asset investment,” the stock analyst said.

“However, uncertainty inside the country following Prime Minister Prayut Chan-o-cha declaring a state of emergency to contain the Covid-19 pandemic, starting from March 26 to the end of April, will pressure the economy. Besides, foreign investors have made net sales continuously. This month alone, they have made net sales of Bt73 billion, which would pull the index down.”

The analyst recommended three groups of stocks for investors:

● ICT stocks which benefit from work from home trends, such as ADVANC, INTUCH, and DTAC. 

● Retail stocks, which benefit from people stocking up on products during the Covid-19 situation, such as CPALL and BJC. 

● Food stocks, which would benefit from the weakening baht, such as CPF and TU.

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