Set moves ahead as dow hits 20,000 point milestone

Set moves ahead as dow hits 20,000 point milestone

Recap: The Dow Jones Industrial Average last week crossed the 20,000 mark for the first time, lifting Thai shares by 1% on Thursday to a two-year high before rally slowed at the end of the week. European equities slipped and trading in Asia was subdued because of the Lunar New Year holidays.

The US dollar strengthened against most major peers, while the yen declined and Japanese bonds rose as the country's central bank moved to buy debt. The pound also slid ahead of British Prime Minister Theresa May's meeting on Friday with US President Donald Trump, whose war of words with Mexico and various Twitter threats were keeping investors on edge. Gold prices retreated to a three-week low.

The SET index moved in a range of 1,565.09 and 1,600.79 points and closed at 1,590.80, up 1.8% from the previous week, in heavy turnover averaging 57.4 billion baht a day. Institutional investors were the only net buyers at 4.91 billion baht. Retail investors were the net sellers of 3.4 billion, foreign investors sold 499.6 million and brokers sold 1 billion.

Big movers: Top gainer TLUXE advanced 35.7% to close at 13.30 baht, while top loser CHOW sank 13.85% to 5.60 baht. TPIPL led in volume, down 11.7% to 2.42 baht. Leading in turnover were PTT, up 8.39% to 418 baht; AOT, up 5.2% to 406 baht; and CPALL, gaining 2.1% to 60.75 baht.

Newsmakers: The Public-Private Partnership (PPP) Committee has endorsed seven big-ticket infrastructure projects worth a combined 712 billion baht to start this year. They include the Orange Line eastern and western sections (96 billion baht), the Purple Line linking Kanchanaphisek Outer Ring Road and Tao Pun (131.2 billion) and the Bangkok-Rayong high-speed rail project (152.4 billion).

The Bank of Thailand says stubbornly high household debt is one of four structural problems facing the country, along with the competitiveness of exports, weak private investment and spluttering SMEs.

The University of the Thai Chamber of Commerce forecast Chinese New Year spending from Jan 27 to Feb 2 would reach 54.9 billion baht, a 4.5% increase from the year before and the highest in 10 years, thanks to the recovering economy, rising incomes and farm prices, and more expensive products.

The Board of Investment (BoI) said the value of projects seeking BoI privileges rose nearly 200% last year to 584.35 billion baht, beating the target of 550 billion baht. The jump reflected a very low base in 2015 when many investors put plans on hold pending more clarity on the policies of the military government. Revisions to BoI promotional policies also affected 2015 investment.

December exports rose 6.2% from the year before to US$18.2 billion and the 2016 full-year figure rose for first time in four years, the Commerce Ministry said. Exports for the year totalled $215.3 billion, up 0.45%, and imports declined 3.9% to $194.7 billion.

The cabinet approved an expenditure budget for fiscal 2018 of 2.9 trillion baht, with a deficit of 450 billion baht, estimated at 2.8% of GDP, to continue stimulating the economy.

Public debt stood at 5.94 trillion baht as of November 2016, constituting 42.4% of GDP and falling by 40.95 billion baht, or 0.7% from the previous month, the Finance Ministry reported.

Ministers extended a tax measure supporting domestic investment for another year until Dec 31, 2017. However, the deduction from corporate taxes was reduced to 1.5 times from double the investment value.

SC Asset plans to shift to lower-end housing units priced below 3 billion, and establish a venture capital firm for property technology. It expects to launch 17 new projects worth a combined 27 billion in 2017.

True Corp targets 14-15% growth in household fixed-line broadband internet subscribers this year, driven by market competition. As of the third quarter of 2016, it had 2.7 million subscribers for a 38% share of the total fixed-line broadband internet market.

The Civil Aviation Authority of Thailand (CAAT) plans to reissue air operator certificates to nine Thai-registered airlines by June ahead of inspections by the International Civil Aviation Organization (ICAO) in the same month.

A new bioeconomy development plan launched by the government and the private sector is expected to draw 400 billion baht in investment over 10 years. It will include new refinery complexes in Rayong and Khon Kaen to process cassava and sugarcane into high-value products.

The Business Development Department forecast new business registrations this year would rise 3% to 66,000, with investment worth 240 billion baht. Growth would be helped by infrastructure investment, an improving economy and tax incentives.

The central bank and the SEC said a recent series of defaults on bills of exchange would have only a limited impact on overall financial stability, as the debt instruments account for just a small portion of the overall bond market.

The consumer-to-consumer (C2C) platform of the government's PromptPay electronic payment system was launched on Friday and the business-to-business (B2B) platform is set to debut on March 1. The launch was delayed from last October because of concerns about security.

TOT Plc has put off its plan to establish an infrastructure fund for nine months after discovering that its existing short-term rental network pattern does not meet the conditions needed to establish a viable long-term fund.

Coming up this week: Thailand will release December manufacturing data, and US pending home sales are due the same day.

Euro zone fourth-quarter GDP figures are due tomorrow, and the US Federal Reserve begins a two-day meeting, with results expected around 2am Thursday Thailand time.

China will release manufacturing and non-manufacturing PMI for January on Thursday.

US non-farm payrolls and euro zone composite PMI are due on Friday.

Stocks to watch: KGI Securities suggests that after strong rallies in recent weeks, the SET Index is now around fair value. Among key big-cap names it sees only four -- KTB, SCC, AOT and ADVANC -- still offering more than 10% upside to their targets. Hence, traders should be very selective and buy laggards.

Finansia Syrus Securities is maintaining its end-2017 SET Index target at 1,650, so the upside is limited. It recommends waiting to buy on weakness, focusing on stocks including MINT, ERW, CPALL, EA and AOT.

Bualuang Securities recommends high-dividend stocks GLOW, IRPC, KTB, TCAP, SC, SIRI and LPN.

Technical view: RHB Retail Research sees support at 1,540 and resistance at 1,608. Bualuang Securities sees support at 1,550 and resistance at 1,620.

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