RECAP: Asian equities were poised to end a turbulent week on a steady note and Thai shares had their best week of the year, while currencies edged higher ahead of crucial US payrolls data that could set the stage for a larger interest rate cut.
Following robust foreign and institutional buying on Thursday, SET trading value exceeded 107 billion baht on Friday.
The SET index moved in a range of 1,352.11 and 1,431.24 points this week, before closing yesterday at 1,427.64, up 5% from the previous week, with daily turnover averaging a healthy 78.23 billion baht.
Institutional investors were net buyers of 5.91 billion baht, followed by foreign investors at 4.74 billion. Retail investors were net sellers of 8.96 billion baht, followed by brokerage firms at 1.69 billion.
NEWSMAKERS: US job openings in July slipped to 7.67 million, the lowest since January 2021, indicating a continued easing in the labour market, according to the monthly Jolts (Job Openings and Labor Turnover Survey) report. This could further encourage the Fed to reduce interest rates this month.
- Atlanta Federal Reserve president Raphael Bostic signalled on Wednesday that he is ready to start lowering interest rates even though inflation is still running above the US central bank's target.
- Shares of the AI chip leader Nvidia fell almost 10% at midweek, shedding $280 billion of value, on fears that the recent surge in firms linked to artificial intelligence may have been overdone.
- New-home sales from China's 100 biggest real estate companies fell 26.8% in August from a year earlier to 251 billion yuan ($35.4 billion), faster than the 19.7% decline in July, according to China Real Estate Information Corp.
- Oil prices jumped more than 1% after the Opec+ alliance agreed to pause a planned output increase for two months after prices fell amid fragile demand and plentiful supply.
- Europe's aviation regulator called for at least part of the Airbus A350 fleet to be inspected as a precautionary measure, after an engine part failed during a flight by a Cathay Pacific plane, causing the Hong Kong carrier to ground 15 planes.
- China will begin an anti-dumping investigation into Canadian rapeseed and canola imports as trade tensions rise. The move follows Canada's imposition of tariffs on Chinese EVs, steel and aluminium.
- China has threatened strong economic retaliation against Japan, including restricting access to essential minerals for automotive production, if Japan exerts greater control on chipmaking equipment sales to Chinese companies.
- The global EV market leader BYD reported record-high August car sales of 370,854 units, up 30% year-on-year, driven by a 48% increase in hybrid sales, which accounted for two-thirds of total sales.
- Volvo has abandoned its target to produce only fully electric cars by 2030, saying it now expects to still be selling some hybrid vehicles by that date.
- The German luxury carmaker BMW says it aims to mass-produce its first hydrogen-powered car in 2028, using fuel cell technology jointly developed with Toyota.
- The Japanese 7-Eleven operator Seven & i Holdings Co has rejected a $39-billion takeover proposal from the Canadian retailer Alimentation Couche-Tard, saying it "grossly undervalues" the company, while signalling a willingness to consider a sweetened offer.
- Mitsubishi UFJ Financial Group, Japan's biggest lender, will consider shifting more of its $488-billion securities portfolio into Japanese government bonds when yields reach 1.2%, as it expects the central bank to continue raising interest rates.
- The Bank of Canada on Wednesday lowered its key lending rate by a further 0.25 percentage points, to 4.25%, amid signs of a softening economy and lower inflation. It is the third consecutive cut by the central bank.
- The composite PMI for the euro zone, compiled by S&P Global and seen as a good gauge of overall economic health, jumped to 51.0 in August from 50.2 in July, as business activity received a boost from the Olympic Games in France.
- Alibaba has developed a US credit card with Mastercard in the hopes of encouraging small businesses to buy products on the Chinese company's web marketplace.
- Thai stocks skyrocketed on Thursday, posting their biggest single-day gain since March last year and breaking the 1,400-point barrier. The baht also advanced as investors took heart from the formation of the new Pheu Thai-led government, hoping for policy continuity.
- The Ministry of Finance is preparing to sell Vayupak 1 investment fund units to general investors from Sept 16-20, and to institutional investors on Sept 18-20. The fund is expected to begin making its investments in the stock market on Oct 1, with an estimated 150 billion baht entering the market.
- The House late Thursday passed the 3.75-trillion-baht budget for fiscal 2025, which will allow Prime Minister Paetongtarn Shinawatra to lift state spending to accelerate a nascent economic recovery.
- Thailand's EV sales will fall far short of the target of 150,000 units as lenders turn more cautious because of near-record household debt, says the Electric Vehicle Association of Thailand. New EV registrations are seen at 80,000 units this year, about 5% more than the 76,000 units sold in 2023.
- The Bank of Thailand is in the process of amending regulations to allow those taking out car loans to apply jointly with family members or relatives.
- Headline inflation slowed in August, rising 0.35% from a year earlier, compared to 0.83% in July, as food prices rose and energy prices fell, the Ministry of Commerce ministry said.
- The Revenue Department is amending the law to require foreign online platforms to register as vendors in the value-added tax (VAT) system, as part of a broader campaign to counter cheap imports.
- The Digital Industry Sentiment Index in the second quarter declined to 52.4, from 54.1 in the previous quarter due to weaker purchasing power and the delay in state budget disbursement.
- Nielsen reports advertising spending for high-end products in Thailand increased by 214% year-on-year in the first half, the highest growth in Asia. About 82% of the advertising budget was spent on out-of-home media.
- The Bank of Thailand said the Business Sentiment Index for August 2024 remained stable at 47.1, with increased confidence in production and orders but decreased confidence in employment.
- The Ministry of Transport says it plans to push the Land Bridge project during the new government's term. The Southern Economic Corridor Act is expected to be proposed to parliament by September 2025, with construction in Ranong and Chumphon expected to begin in the third quarter of 2026.
- The Industrial Estate Authority of Thailand (IEAT) reported record-high land sales and leases of 6,174 rai in 2024, the second year of record sales, indicating sustained demand.
- The SET-listed developer Supalai will earmark 12.6 billion baht for acquiring and developing 12 residential projects in five Australian cities, following a decade in which it invested 9.7 billion baht in 12 projects across four cities.
COMING UP: On Monday, the US releases consumer credit data and one-year consumer inflation expectations. On Tuesday, Germany announces monthly inflation and the UK reports employment changes. Wednesday brings a UK GDP update, US and Russian inflation figures and Japanese business sentiment. On Thursday, the European Central Bank will hold a policy rate meeting, and the US updates jobless claims and producer prices. Friday brings Japanese, Chinese and euro zone industrial production updates, Indian inflation, and a Russian interest rate decision.
- Locally, the Federation of Thai Capital Market Organizations (Fetco) on Monday announces Investor Confidence Index (ICI).
STOCKS TO WATCH: Trinity Securities is looking at safe bets for short-term investors. The recommended stocks have market capitalisation above 20 billion baht, trading turnover of at least 100 million baht a day, a free float of more than 30%, a dividend yield of 3% or higher, and a forward PE ratio below the five-year average. Its picks are BBL, HMPRO, KTC, LH, OSP, EGCO, JMT, AMATA, JMART and ICHI.
- Finansia Securities recommends stocks that the Vayupak Fund is expected to choose, normally companies with solid fundamentals, dividend yields of 3% and and ESG scores of AA or higher. Its picks are BDMS, BBL, KBANK, KTB, TISCO, ADVANC, INTUCH, CPALL, CPN, HMPRO, AOT, CPAXT, PR9 and WHAUP.
TECHNICAL VIEW: Tisco Securities sees support at 1,350 points and resistance at 1,480. CGS International Securities sees support at 1,385 and resistance at 1,450.
