SET Index feels the pressure of global Covid-19 situation

Krungsri Securities predicted that the SET Index will fall between 1,300 and 1,320 due to uncertainty following the worldwide spread of Covid-19 virus, which has caused a global economic slowdown.
A stock analyst at Krungsri Securities said that China’s Purchasing Managers’ Index in February in both the production and service sectors had collapsed from the virus impact.
“The Covid-19 situation is still worrisome, as it was spreading in over 58 countries worldwide, while the first coronavirus deaths were confirmed in Thailand and the US,” the stock analyst said.
“On Sunday [March 1], the number of new infected people outside China increased to 1,160 people, higher than the average in the previous week of 600 people a day, while the number of new infected people in China has increased to 579 people, higher than the average in the previous week of 400 people a day.”
The analyst expects that the government will declare the third phase of the epidemic on Monday (March 2), causing investors to remain under pressure.
“We recommend buying stocks when the price is cheap, focusing on defensive stocks,” the stock analyst added.
The analyst explained that the SET Index on Friday (February 28) fell sharply by 54.56 points or 3.91 per cent to 1,340 with a trading value of Bt86 billion following a decline in global stock markets due to uncertainty following the Covid-19 outbreak.
“Foreign investors made net sales of Bt301 million in shares, and Bt2.129 billion in the bond market, while there are 13,010 net short TFEX contracts,” the stock analyst said.
“The SET Index in February provided a contraction in returns of 11.5 per cent. We expect that the index in March will fluctuate at the resistance between 1,250 and 1,300 due to uncertainty following the coronavirus outbreak.”
Meanwhile, Teerada Charnyingyong, chief strategist at Phillip Securities, said that the SET Index has a chance to rebound from the positive sentiment as the government plans to issue measures to stimulate the economy in the Cabinet meeting on Tuesday.
“We recommend investors who cannot handle risks to hold cash,” she said.