Tuesday, July 07, 2020

Grim outlook for GDP, Apple suppresses SET index

Feb 19. 2020
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By The Nation

Tisco Securities has predicted a drop in the Stock Exchange of Thailand index on Wednesday (February 19), with support at 1,495-1,505 points and resistance at 1,520-1,525, due to another decline in the outlook for gross domestic product.

The SET fluctuated in the negative on Tuesday after Apple announced its Q1 sales this year would probably fall short of target because production and demand are off in China.

At the same time, Thai GDP looks likely to be under 2 per cent this year, it was reported.

Foreign investors’ net sells over eight consecutive days reached Bt2.44 billion and there were 1,022 short-term S50 Futures contracts.

Senior Tisco Securities strategist Apichat Poobunjirdkul noted that global stocks fell on Tuesday on the back of a larger-than-expected tumble in Germany’s economic confidence index.

“Meanwhile the global supply chain was hurt by Apple warning of a decline in its sales since China’s production capacity is recovering so slowly and demand has decreased because of the Covid-2019 virus,” he said.

The gold price rose by 1.3 per cent, closing above US$1,600 per ounce for the first time in seven years, causing fear among investors amid the economic slowdown.

“The oil price closed at $52.05 per barrel, so we expect Opec to lower production in response to reduced demand,” Apichat said.

“The stock-price fluctuation at the SET was high due to foreign investors and domestic funds selling to adjust their portfolios. Investors should wait for the coming CP-All announcement about its performance, and we expect 4Q19 profit will be Bt5.84 billion.”

He also suggested selling stocks to reduce risks if the SET index rebounds to above 1,525 points.

His outstanding picks for February are AP, EASTW, ERW, KKP, RBF and Tasco.

The index rose by 1.79 points or 0.12 per cent to 1,523.61 in the morning session, with a total value of Bt28.5 billion.

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