SET Index takes a tumble as virus woes multiply
The Stock Exchange of Thailand (SET) Index slid almost 4 per cent due to global uncertainty following the Covid-19 outbreak. As of 10.30am on Friday (February 28), the index had fallen by 53.85 points, or 3.86 per cent, to 1,341.23.
Krungsri Securities has predicted that the SET Index will fall to 1,355 points following global markets, as investors still remain under pressure from the worldwide spread of Covid-19.
A stock analyst at Krungsri Securities said that the increasing number of patients outside China had caused effects on the global economy, confidence among investors, and performance of listed companies.
“Meanwhile, crude oil price fell sharply due to contracting demand following the economic situation, which will be a negative sentiment on energy and petroleum stocks, as well as investment direction,” the stock analyst said. “We suggest buying stocks when the price is cheap, focusing on defensive stocks.”
The analyst explained that the SET Index on Thursday (February 27) rebounded by 28.67 points or 2.10 per cent to 1,395 with trade value of Bt74 billion due to a technical rebound following oversold conditions and investors buying in health, electronic and bank stocks that fell sharply earlier.
“Foreign investors made net sales of Bt110 million, and Bt11.153 billion in the bond market, while there are 27,751 net long TFEX contracts,” the stock analyst said.
Four types of stocks are recommended:
● Defensive stocks expected to pay high dividends, such as ADVANC, INTUCH, and TTW
● Electronic and food stocks, which will benefit from the weakening baht, such as KCE, HANA, DELTA, CPF, and TU
● Financial stocks, which will benefit from reduced financial costs after the Monetary Policy Committee cut the interest rate by 0.25 per cent, such as MTC, SAWAD, and KTC
● Stocks that Morgan Stanley Capital International (MSCI) will boost investments in, such as CRC, BTS, and BDMS.