ท่านสามารถอ่านและดาวน์โหลดเอกสารได้จาก Daily240710_TLimited upside. Follow politics and US CPI
Market todayUpside is seen as limited with resistances at 1325 and 1330 on a continued lack of new catalysts as well as the political overhang in the case regarding the Prime Minister’s qualifications and US CPI. Be cautious of risk-averse selling, which may pressure the index; supports are at 1315 and 1310.Today’s highlights• The Fed Chairman told the Senate Banking Committee that too slow or too little monetary policy easing could weaken the economy and employment. He also noted that more positive inflation data would increase the Fed's confidence that inflation is sustainably moving towards 2%.
• Volkswagen Group cut its profit forecast to 6.5-7.0% from 7.0-7.5% due to the risk of closing the Audi Brussels plant amid low demand for high-end EVs.
• The BoT reported household debt in 5M24 reached a record high of Bt1.14tn in NPLs, surpassing the Bt1.1tn during COVID. Car, home, credit card and cooperative loans continue to rise. An economic cabinet meeting to address household debt is scheduled for July 15.
• Today, attention is focused on the Constitutional Court and whether it will consider the case for the removal of the Prime Minister after the parties involved were given 15 days to submit opinions and evidence.
• Today, the Energy Regulatory Commission (ERC) board meets to consider the new Ft rate for Sep-Dec 2024. This is expected to be raised by Bt0.20-0.40/unit from the current Bt4.18 baht/unit, to accommodate gradual debt repayment to EGAT and fuel debt to PTT.
• The SET is talking with the SEC about disclosing information about listed company executives who are using shares as loan collateral or mortgages on a website for investors, changing from the current monthly disclosure.Strategy today In the short term, the SET is still fragile and range-bound due to prolonged political uncertainties. The Constitutional Court has scheduled a hearing on the PM’s qualifications for July 10 and the Move Forward Party dissolution on July 17. The market is expected to be supported by external factors as the Fed is likely to signal an easing in monetary policy after US CPI slowed in June to 3.1%YoY from 3.3%YoY in May as well as slowing job market figures. Our strategy is “Selective Buy”. Trading todayThai capital market is seen to still be fragile and range-bound while waiting for some political clarity and a new catalyst. We recommend "Selective Buy" with four main themes:
1) Stocks expected to benefit from short covering after the SET implemented the uptick rule on July 1 and which also have SETESG ratings between AAA to A - HANA, TOP, BEM, MINT, OSP, BBL, SCGP and AOT.
2) Stocks expected to benefit from changes in conditions for the ThaiESG fund: raising deductions to up to Bt300,000 and reducing the holding period to five years - ADVANC, CPALL, BDMS, BBL, BEM and GULF.
3) Global plays whose profit is expected to grow and which benefit from global economic recovery over domestic plays, which face multiple uncertainties -SCGP, TU and MINT. (We recommend buy SCGP on price dips when pressured by weak Chinese economic figures.)
4) Tension has eased about the situation in the Middle East, leading Brent down to the lower bound of US$80-90/bbl, which is seen as an opportunity to hedge. For high-risk takers, we recommend an upstream oil stock - PTTEP.Daily top picksAOT: Profit will move up with tourism. FY2024 core profit is expected to grow to Bt23bn (+150%) and to Bt28bn (+23%) in FY2025. Core profit in 3Q24FY (Apr-Jun 2024) is expected to grow YoY but decline QoQ on seasonal factors. Recommend buy at not higher than Bt57.25/share.
GPSC: It has short-term positive from a decline in natural gas cost and Ft adjustment for Sep-Dec 2024 by the ERC. 2Q24 core profit is expected to improve YoY and QoQ on lower natural gas cost and increasing contribution from Avaada and CFXD. Recommend buy at not higher than Bt39.75/share.Today’s reportsPetrochemicals – Naphtha cost up to 4-month high
SCGP – Preview 2Q24: Down QoQ but up YoY Click here to read and/or download file Daily240710_E |
