SET reacts to bleak US economic data
The Stock Exchange of Thailand (SET) Index dropped by 1.40 points, or 0.11 per cent, to 1,271.13 on Friday (April 24) morning.
A stock analyst at Krungsri Securities expected the index to fluctuate between 1,260 and 1,280.
“The market gained support from rising crude oil price due to tensions in the Persian Gulf and the US House of Representatives approving US$484 billion for Covid-19 relief measures to help small enterprises and hospitals,” the analyst said.
“In addition, investors expected the Thai government to ease lockdown measures after the number of Covid-19 patients has dropped continuously, while Prime Minister General Prayut Chan-o-cha will review the state of emergency on Tuesday [April 28]."
The analyst said the index would be under pressure from the weakening US economy -- the number of applicants for unemployment welfare rose to 4.4 million people, new home sales in March dropped by 15.4 per cent, and Purchasing Managers Index in manufacturing and services in April dropped to a historic low at 27.4.
“Meanwhile, the World Health Organisation has reportedly said that remdesivir was not effective against the Covid-19 virus,” the analyst said.
The analyst explained that the SET Index on Thursday closed at 1,272, up 10.72 points or 0.85 per cent with transactions totalling Bt69 billion.
“Foreign investors made net sales of Bt2.765 billion. There are 256 net long TFEX SET50 contracts, and net buy in the bond market was Bt2.246 billion,” the analyst said.
The analyst recommended that investors make selective buys from four groups of stocks:
● Retail stocks that would benefit from the decline in the number of Covid-19 patients in Thailand and the expected easing of lockdown measures on Tuesday (April 28), such as CRC, CPN, HMPRO, GLOBAL and COM7.
● ICT and food stocks that have escaped the severe impact of the outbreak, such as ADVANC, INTUCH, DTAC and CPF.
● Public utility stocks that have consistent revenue and profits, such as GPSC, GULF, BGRIM, BCPG and TTW.
● Financial stocks that would benefit from the Accounting Profession Supervision Committee easing Thai Financial Reporting Standards 9 and low-interest soft loans, such as KTC, SAWAD, MTC, JMT and BAM.
