Markets steady after initial omicron shock
Recap: European shares edged higher yesterday while global markets steadied after a tumultuous week induced by the the new Omicron Covid-19 variant and the prospect of accelerated stimulus tapering by the US Federal Reserve.
The SET index moved in a range of 1,563.04 and 1,617.55 points this week before closing yesterday at 1,588.19 points, down 1.39% from the previous week, in daily turnover averaging 98.29 billion baht.
Retail investors were net buyers of 22.7 billion baht. Foreign investors were net sellers of 11.43 billion baht, brokers sold 8.15 billion baht and institutional investors offloaded 3.12 billion baht worth of shares.
Newsmakers: Shares of the Southeast Asian superapp Grab slid more than 20% in their Nasdaq debut on Thursday following the company's record $40-billion merger with a blank-cheque company. The shares jumped 21% minutes after the market opened but were off 23% by the end of the day.
- The Chinese ride-hailing giant Didi Global said yesterday it would delist from the New York stock exchange and pursue a listing in Hong Kong, succumbing to pressure from Chinese regulators concerned about data security.
- The US-listed Chinese microblogging platform Weibo is seeking to raise up to $547 million in a share offering in Hong Kong, documents showed Monday, making it the latest China tech company to list closer to home as tensions with the United States rise.
- More US-listed Chinese companies could start heading for the exits as new SEC audit rules will require companies to disclose whether they are owned or controlled by a government entity.
- The world economy awoke from its pandemic-induced coma in 2021, but inflation, supply chain bottlenecks and a resurgent coronavirus have taken the shine off the comeback. Most emerging and developing countries will still be far behind their pre-pandemic forecasts in 2024, the IMF says.
- Oil prices revived yesterday after Opec and its allies said they would stick with their current modest output increases, but would "make immediate adjustments if required" to ease a supply shortfall.
- It's time to stop calling inflation "transitory", US Treasury Secretary Janet Yellen said on Thursday, while Fed chairman Jerome Powell acknowledged that the central bank might have to speed up its stimulus withdrawal to keep surging prices in check.
- Global airlines are bracing for more volatility as the Omicron coronavirus variant could force them to juggle schedules and destinations at short notice and to rely more on domestic markets where possible, analysts say.
- Japan's flag carriers halted all new reservations on Wednesday amid Omicron worries but eased off a day later amid complaints that the move would prevent citizens from returning home.
- Markets today are wildly overvalued in places, making the current environment "even crazier than the dotcom era", according to Charlie Munger, the right-hand man of legendary value investor and Berkshire Hathaway chief Warren Buffett.
- The cabinet on Tuesday approved a combined 141 billion baht to support income guarantees for rice and rubber farmers in the 2021-22 season.
- Thailand recorded a current account deficit of $1.1 billion in October, compared with $1.3 billion the previous month, the central bank said on Tuesday.
- The government will introduce measures aimed at generating jobs and boosting income early next year, Finance Minister Arkhom Termpittayapaisith said on Monday.
- The Finance Ministry stands ready to inject additional money to revive the economy if the Omicron variant hits the country, says Fiscal Policy Office director-general Pornchai Thiraveja.
- Thai exports are expected to grow 17% this year, the highest growth rate in 12 years, Finance Minister Arkhom said on Monday.
- Manufacturing costs are forecast to increase by 10-20% in the next 3-6 months, mainly because of higher energy prices, according to the Federation of Thai Industries.
- Thailand's manufacturing production index (MPI) in October rose by 2.91% year-on-year to 97.99 points, close to the level recorded for the corresponding month in 2019 -- prior to the pandemic, as the industrial sector looks set to gain momentum, says the Office of Industrial Economics (OIE).
- The domestic construction market is expected to grow by 6% to 850 billion baht next year, due to state infrastructure projects and better economic prospects thanks to the speedy rollout of Covid vaccinations, says Civil Engineering Plc.
- The government has said it will not step back from its reopening plan despite uncertainty over the Omicron variant, and the Tourism and Sports Ministry will propose more relaxation of alcohol sales.
- Air passenger traffic after Thailand's reopening on Nov 1 has not lived up to operators' expectations as demand from foreign tourists has been lukewarm, says Nok Air.
- The cabinet has approved a new one-year Medical Treatment Visa to boost the country's attraction as an international medical hub.
- The Finance Ministry may consider lowering the import duty on electric vehicles as part of a series of measures to spur more purchases by consumers put off by high prices.
- The domestic car market is suitable for plug-in hybrid electric vehicles (PHEVs) rather than battery-powered electric vehicles (BEVs) because of limitations in EV infrastructure, which is mostly centred in big cities, say executives of Lexus, Toyota's luxury car unit.
- The Bank of Thailand on Wednesday warned companies about accepting digital assets as payment for goods and services, as more companies rolled out partnerships to accept major cryptocurrencies as payment.
- One of those companies jumping on the crypto bandwagon is The Mall Group. The shopping centre operator has teamed up with the crypto exchange operator Bitkub Capital Group Holdings and others for a joint venture aiming to make Thailand a top Asian hub for digital asset investment and tourism.
- Thailand's digital transformation could generate up to 2.5 trillion baht in annual economic value by 2030, equivalent to 16% of GDP in 2020, according to a report commissioned by Google.
- 5G subscriptions in Thailand are expected to reach 70 million by 2027, or 73% of all mobile accounts, according to Digital Economy and Society (DES) Minister Chaiwut Thanakamanusorn.
- The National Science and Technology Development Agency (NSTDA) is paying 600 million baht to buy the most efficient supercomputer in Southeast Asia, with the aim of boosting science and technology in line with the bio-, circular and green (BCG) economic model.
- Central Retail Corporation (CRC), the SET-listed retail arm of Central Group, is set to spend 4.5 billion baht to purchase the majority of shares of Porto Worldwide, which has a 40% stake in the Thai business of the regional superapp Grab.
- The SET-listed developer Noble Development Plc is bullish about the 2022 property market, planning to launch 18 new projects worth a combined 47.4 billion baht with nearly half being joint ventures with BTS Group Holdings.
Coming up: Britain will release data on the construction industry on Monday. On Tuesday, China will release November trade figures, the Reserve Bank of Australia will announce its interest rate decision and the euro zone will release third-quarter GDP.
- Japan will release third-quarter GDP on Wednesday. The US will release October job openings and crude oil inventories. The Bank of Canada will announce its interest rate decision.
- The US will release initial jobless claims on Thursday, and China will release November consumer and producer prices. Britain will release October manufacturing production and trade figures on Friday and the US will release November core inflation.
Stocks to watch: Capital Nomura Securities recommends stock that will gain from the weakening baht such as export-oriented, agricultural, electronics and food producers. The broker recommends TU, CPF, NER, XO, SAPPE, ASIAN, SVI, HANA, KCE, EPG and BANPU. For monthly plays it recommends ADVANC, AMATA, BCH, JMT, TIDLOR, KCE and TRUE. Stocks that could outperform the market in the fourth quarter include ADVANC, TRUE, BEM, KCE, BDMS, CPALL, GPSC, GULF,TIDLOR, MAJOR and JMT.
- DBS Vickers Securities foresees considerable uncertainty over Omicron, so it recommends holding 40% cash in one's portfolio. The broker suggests looking at mega themes for a medium- and long-term strategy. Stocks recommended are GPSC, GULF, ADVANC, TRUE, KCE, HANA, SAPPE, SCB, KBANK, SCB, KBANK, JMT and TIDLOR.
Technical view: DBS Vickers sees support at 1,560 points and resistance at 1,610. Tisco Securities sees support at 1,550 and resistance at 1,620.