Global worries keep a tight lid on local stocks

Global worries keep a tight lid on local stocks

Recap: Concern about the looming US "fiscal cliff" and weaker economic data in Europe kept the SET index down for most of the week, with a sharp fell on Thursday in line with global markets. The market rebounded on Friday on good news that Thai shares had been given more weighting in the influential MSCI index.

The market moved in a narrow range between 1,263.05 and 1,296.56 points and closed at 1,280.13, down 0.8% from the previous week. Foreign investors were net sellers of 8.75 billion baht, while brokers sold 1.36 billion. Institutional investors were net buyers of 6.91 billion baht, reflecting seasonal shopping for stocks to include in LTFs and RMFs. Domestic retail investors were net buyers of 3.2 billion baht.

Big movers: Charoen Pokphand Foods (CPF) led in terms of turnover, declining 6.94% on the week to 33.50 baht. ADVANC rose 5.1% to 197 baht on speculation about the Administrative Court ruling on the disputed 3G auction. BTS declined 6.1% to 6.15 baht. Bangkok Land (BLAND), tops in volume, fell 8.3% to 1.21 baht. OSK Securities (OSK) gained 61.4% to 4.52 baht after RHB Capital announced a tender offer at 4.584 baht per share.

Newsmakers: MSCI Inc made its semi-annual review of the MSCI Global Standard Indices and MSCI Global Small Cap Indices, widely watched by big foreign investors. From the SET, AOT, BGH, CPN and MAKRO have been added to the MSCI Global Standard. BAFS, GOLD, LOXLEY, ROJNA, SRICHA, SITHAI, SVI, TK and VIBHA were added to the MSCI Global Small Caps. EGCO, MINT, RATCH, ROBINS and TRUE were removed. All changes will be effective as of the close of trade on Nov 30.

- China's ruling Communist Party unveiled its new leadership line-up on Thursday to steer the world's second-largest economy for the next five years, with Vice President Xi Jinping taking over from Hu Jintao as party chief.

- The World Bank estimates Thailand's economy will grow by 4.7% this year and 5% next year, with export growth of 8% despite flat growth in the global economy. This is based on an assumption that global trade volume will grow by 5.5% next year, up from 3.7% this year.

- On the local political front, attention is turning to the anti-government rally scheduled for this Saturday and the no-confidence debate against the government slated to begin the following day. Maybank Kim Eng Securities says neither event will likely undermine the government's stability, but political uncertainty could rise if the issues raised in the debate trigger social unrest.

- Government tax revenue in October, the first month of fiscal 2013, rose 11.3% from a year earlier to 148 billion baht thanks to greater consumer spending, the first-time car buyer scheme and steeper excise tax on beer.

- Ch. Karnchang, the country's second-largest contractor, has won the right to build the Green Line extension of the skytrain, running 12.6 kilometres from Soi Baring to Samut Prakan, at a cost of 2.46 billion baht.

- Ratchaburi Electricity Generating Holding, Thailand's largest private power producer, will delay the purchase of a coal mine in Indonesia, as global coal prices have dropped sharply.

- Siam Commercial Bank will open its first representative office in Yangon, Myanmar's commercial hub, late this month.

- RHB Capital Bhd, the Malaysia-based financial conglomerate, will make a tender offer for SET-listed OSK Securities (Thailand) following its acquisition of OSK Investment Holding in Malaysia. OSK Investment Holding owns OSK Investment Bank, which in turn has a 97.35% stake in OSK Securities in Thailand. RHD said it will make an offer for the 2.65% of OSK Securities shares it does not already own at 4.58 baht each.

- BTS Group Holdings said an infrastructure fund worth 50-60 billion baht will enable it to expand its investment in infrastructure business both at home and abroad. The fund aims for yields of 6-7% a year for investors. Income will come from skytrain operation, which produces Ebitda of more than 4 billion baht annually.

- Newcomer Cable Thai Holding (CTH) shocked the media world by winning broadcast rights for English Premier League (EPL) football for the next three seasons with an "incredibly high" bid, said to be about US$300 million. That would be five times what TrueVisions, the current EPL rights holder, paid for its three-year deal that will end next May.

Coming up this week: The National Economic and Social Development Board reports official third-quarter economic figures today.

- The Bank of Japan opens a two-day meeting today.

- Euro-zone leaders will hold talks tomorrow about new funds for Greece, and Spain will hold a Treasury bill auction.

- SET in the City, the annual investment fair staged by the SET, will be held on the fifth floor of Siam Paragon from Thursday through Sunday.

Stocks to watch: KGI Securities recommends stocks based on the strong tourism outlook and index revisions. It says investors should buy on market weakness into AOT, CENTEL and Jasmine International (JAS). For an earnings story, KGI suggests PS and THCOM.

- Bualuang Securities recommends stocks that are buying targets of LTFs and RMFs before year-end, among them ADVANC, AOT, AP, BGH, CK, CPN, INTUCH, KBANK, TOP, SCB, SCC, STEC and SPALI. Also consider stocks that will be added to the SET50 (KK, TTW, JAS) and stocks that will be included in the revised MSCI calculations: AOT, BGH, CPN and MAKRO.

Technical view: Bualuang Securities sees support at 1,270 points and resistance at 1,290. Krungsri Securities sees support at 1,260 points and resistance at 1,300.

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