Recap: Asian stock markets last week were locked in directionless trading amid mixed cues from the economic data of major economies.
In Thailand, the controversial amnesty bill, which legislators will consider on Aug 7, stoked fears of fresh political clashes and depressed investor sentiment.
The SET index traded in the range of 1,519.21 and 1,445.28 points and closed on Friday at 1,476.71, down 0.3% from a week earlier, with daily average trading value of 51.09 billion baht. Foreign investors bought 414.88 million baht more than they sold, local institutional investors were net buyers of 3.03 billion baht, while brokerage houses pulled a net 2.43 billion baht out of the market and local retail investors were net sellers of 1.01 billion baht.
Big movers: ICT stocks led in trading value. INTUCH rose 2.53% on the week to 91.25 baht, TRUE gained 1.7% to 8.90 baht, and JAS edged up 1.2% at 8.50 baht. INSURE was the top gainer last week, rising 13% to 74 baht, while PAE was the top loser, falling 11.5% to 1.39 baht.
Newsmakers: The G20 finance ministers reaffirmed their commitment to increasing employment and stimulating economic growth as the global economic recovery remained fragile, and indicated that foreign exchange fluctuations had negatively affected economic and financial stability.
- The Liberal Democratic Party (LDP) of Japanese Prime Minister Shinzo Abe won the senate election on July 21, giving it a majority in both houses and strengthening the premier's hand in carrying out stimulus measures.
- Virabongsa Ramangkura, the outgoing chairman of the Bank of Thailand, warned the Thai economy could slow down in the second half as the first loan drawdowns for the 2-trillion-baht infrastructure programme are expected to start with the new fiscal year on Oct 1.
- Meiji Yasuda Life Insurance, Japan's second-largest life insurer, has signed a deal to purchase a 15% stake in Thai Life Insurance. Bloomberg quoted an unnamed source as saying the deal was worth 70 billion yen (22.1 billion baht).
- The government admitted on Friday that its export growth forecast of 7% to 7.5% would not be met, with 3% more likely, after reporting that June exports fell by 3.38% year-on-year. Shipments to China, Thailand's biggest market, were off 17%.
- The Thai Retailers Association (TRA) has revised down its growth forecast for retail and wholesale business this year to 9% from 12% due to declining consumer purchasing power.
- The developer Supalai is expanding its investment in Asia with a budget this year of at least 2 billion baht from its overall 2013 investment budget of 15 billion.
- Thailand's largest hot-rolled coil steelmaker, Sahaviriya Steel Industries (SSI), will return to normal loan status soon as liquidity is improving and production at its British unit is rising under a debt restructuring plan.
- SET-listed Rojana Industrial Park has agreed to partner with Italian-Thai Development to develop the industrial estate at the Dawei deep-sea port project in Myanmar. Rojana will hold 50% of the special-purpose vehicle (SPV) to be responsible for the estate.
- PTT Exploration and Production (PTTEP) reported a 37.9% year-on-year increase in second-quarter net profit to 10.66 billion baht.
Coming up this week: The Fiscal Policy Office will release economic data for June today.
- The US will release pending home sales data today and consumer confidence figures tomorrow.
- The Bank of Thailand will release monthly trade, private investment and consumption data on Wednesday.
- The US Federal Open Market Committee will announce the results of its two-day meeting on Wednesday (2am Thursday Thailand time).
- Thailand will release June inflation figures on Thursday and the European Central Bank will meet the same day.
- US non-farm payroll figures for July are due to be released on Friday.
- Earnings season for Thai listed non-banking companies continues this week.
Stocks to watch: Given that the stock market remains highly volatile this week due to rising political risk, Asia Plus Securities recommends buying laggard stocks such as TTW, SNC, INTUCH, BECL, TOP and CPF.
Finansia Syrus Securities recommends buying PTTEP, CPF and SIRI, and holding STANLY and FPI.
Technical views: KT Zmico Securities sees support at 1,450 and resistance at 1,478. ASP sees support at 1,429 and resistance at 1,492.
About the author
Writer: Nuntawun Polkuamdee & Oranan Paweewun