Recap: Global bourses felt strong selling pressure from the downward spiral of oil prices and the unexpected scrapping of a cap on the Swiss franc against euro, before staging a relief rally on Friday.
The SET Index last week moved in a range between 1,514.89 and 1,548.24 points The main gauge closed at 1,517.74 points, up 0.7% from the previous week, on turnover averaging 41.34 billion baht a day.
Foreign investors continued their selling spree, with a net amount of 9.29 billion baht, followed by brokers with 871.79 million baht in net sales. Institutional investors were net buyers of 4.23 billion baht, and retail investors bought 5.93 billion more than they sold.
Big movers: N.D. Rubber (NDR), a manufacturer and distributor of motorcycle tyres and tubes, gained 107% on its MAI debut to 5.60 baht from its 2.70-baht IPO price. NPARK, last week's top loser, plunged 16.7% to 0.05 baht. Top gainer TLUXE added 71.5% to 6.55 baht. IEC led in volume, gaining 20% to 0.06 baht. Tops in turnover value were TRUE, up 1.7% to 12.20 baht; PTT, down 4.7% to 322 baht; and ITD, adding 1.9% to 7.90 baht.
Newsmakers: The Swiss National Bank shocked financial markets by scrapping a three-year-old cap on the franc against the euro, fearing the impact on the Swiss economy of a new round of bond purchases by the European Central Bank (ECB). The franc soared as high as 0.85 to the euro from the cap of 1.20, before easing back to 1.02. Swiss stocks lost 10% in one day and exporters accused the central bank of incompetence.
Optimism about the outlook for US consumers was tempered as retail sales slumped in December by the most in almost a year. The 0.9% decline followed a 0.4% advance in November.
The German economy, grew by 1.5% last year, beating the government's projection of 1.2%, and up sharply from just 0.1% in 2013.
The World Bank lowered its global growth forecasts for 2015 as weakness in the euro zone, Japan and some major emerging economies would offset the benefit of lower oil prices. It forecast 3% global growth this year, down from 3.4% predicted last June.
Consumer inflation in China was close to a five-year low of 1.5% in December, signalling persistent weakness in the economy. The producer price index declined 3.3% from a year earlier, the biggest decline since September 2012, as sluggish demand curbed companies' pricing power.
China's trade surplus soared by almost half last year to a record $382 billion, but the world's second-largest economy again missed its trade growth target due to weakness overseas. Exports increased 6.1% to $2.34 trillion, while imports rose 0.4% to $1.96 trillion. That translated into a trade surplus of $382.46 billion, a 47.2% increase on 2013.
Transport Minister Prajin Juntong announced plans to proceed with China on four sections of a double-track rail route. Construction of two phases (Bangkok-Kaeng Khoi and Kaeng Khoi-Map Ta Phut) is due to start in September and the remaining two (Kaeng Khoi-Nakhon Ratchasima and Nakhon Ratchasima-Nong Khai) in December. About a dozen Thai companies are being sought to take part, with a list of prospective bidders to be announced in late February.
Industry Minister Chakramon Phasukavanich said many Japanese SMEs were interested in investing in Thailand as a gateway to Asean, and were being encouraged by their government to do so. The ministry hopes to attract 500 Japanese SMEs this year.
The state telecom enterprise TOT released a shortlist of three potential partners. It chose the mobile leader Advanced Info Service (ADVANC), LOXLEY and Mobile LTE, but rejected TRUE and SAMART because of "unrealistic proposals". ADVANC has proposed to jointly manage TOT's telecom towers. TOT expects the new partners to help it generate revenue of 4-5 billion baht a month and help develop the digital economy. TOT also hopes to rent out unused bandwidth to selected partners to provide 4G wireless broadband service.
Disappointing sales and sluggish economic prospects have prompted several Bangkok-based property developers to shelve expansion plans in the provinces after a mini-boom stoked by the policies of the previous government.
The National Institute of Development Administration is forecasting 2015 growth of 4.5%, citing a recovery among trade partners, the advent of the AEC, and a pickup in government spending.
The SET and SEC are considering measures to regulate private placements (PP), which have become more popular as a fund-raising tool. The main concern is the issuing of PP shares at low prices, followed by quick sales to take profits. A lock-up period for PP buyers is likely.
The Investment Analysts Association (IAA) has trimmed its end-2015 target for the SET to 1,670 from the consensus figure of 1,698 in October. The new target assumes a rise in 2015 earnings-per-share growth to 15% (from 14.1% predicted earlier). Analysts cut their 2014 EPS growth estimate to 2.5% (from 8.5%); lowered their estimate of 2014 GDP growth to 0.9% (from 1.6%) and the 2015 forecast to 3.8% (from 4.3%). They forecast an average crude price of $66.10 per barrel (down from $90.50 earlier) this year and US$71.90 next year.
Coming up this week: Thai new car sales for December will be released tomorrow. Also due is Chinese fourth-quarter GDP along with retail sales for December and fixed asset investment, and the ZEW survey of euro zone business expectations.
The Bank of Japan concludes a two-day monetary policy meeting in Wednesday.
The ECB meeting on Thursday will be very closely watched. Many economists believe it will announce sovereign debt purchases worth up to 500 billion euros to stimulate the economy.
Thailand will release December trade data on Friday. Due the same day are the HSBC China Manufacturing PMI for January, US home sales and the Markit euro zone Composite PMI.
Stocks to watch: KGI Securities recommends accumulating DEMCO, IFEC, CSS, VGI and AIE. It has a speculative buy rating on aviation stocks such as AAV, BA and NOK, and telecom plays such as ADVANC.
Thanachart Securities has buy recommendations for TAE, VIBHA and TTCL. Maybank Kim Eng is overweight on banking, with KTB, BBL and TISCO its top picks.
Technical view: Finansia Syrus Securities sees support at 1,510 points and resistance at 1,538. KK Trade sees support at 1,515 and resistance at 1,535.