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SET rebounds on back of government relief measures, Super Savings Fund launch

Mar 31. 2020
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By The Nation

The Stock Exchange of Thailand (SET) Index rose by 26.24 points, or 2.41 per cent, to 1,114.06 in the morning session on Tuesday (March 31).

A stock analyst at Krungsri Securities expected the SET Index would rebound between 1,100 and 1,110 before falling since other regional stock markets had also risen, buoyed by governments worldwide issuing measures to deal with the Covid-19 situation, such as cutting interest rate, using quantitative easing, injecting money, and extending the social distancing period.

“Also, the market would gain internal positive sentiment after several asset management companies prepared to offer a Super Savings Fund (SSF) on April 1, which is expected to generate Bt60 billion and support the index,” the stock analyst said.

Super Savings Fund, a long-term mutual fund with tax deduction benefits, will replace the long-term equity fund (LTF) which expired at the end of last year.

The SSF scheme is expected to draw in investors who used to invest in the LTF and it could potentially boost the SET Index.

The analyst said that uncertainty over the rising number of Covid-19 cases worldwide and declining crude oil price would pressure energy stocks and the index.

“Currently, the number of Covid-19 cases worldwide was 785,777, while crude oil supply would increase after Saudi Arabia prepared to increase its exports to 10.6 million barrels per day in May,” the analyst said.

The analyst recommended investors to make a selective buy from three groups of stocks:

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

● Retail stocks, which benefit from people hoarding 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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