Asian shares slide, SET falls on weak GDP data

RECAP: Asian shares and currencies slipped on Friday as strong economic data from the US and hawkish Federal Reserve comments revived fears that the US central bank will stick to its path of interest rate increases to tame inflation.

Thai shares retreated as fourth-quarter GDP growth was considerably lower than expected, reflecting a slide in exports amid weak global demand. In the medium term, the local market is expected to swing sideways until the Fed meeting on March 22.

The SET index moved in a range of 1,642.97 and 1,669.98 points this week before closing yesterday at 1,651.67, down 0.8% from the previous week, in daily turnover averaging 64.39 billion baht.

Retail investors were net sellers of 2.76 billion baht, followed by brokers at 903.31 million. Foreigners were net buyers of 3.4 billion baht, followed by institutional investors at 253.75 million.

NEWSMAKERS: US consumer prices climbed 6.4% in January from a year earlier, more than forecast and only a slight slowdown from 6.5% in December. Inflation is down from a peak of 9.1% in June, but is still far higher than the Federal Reserve would like, suggesting the central bank will push its benchmark interest rate past 5% this year.

• US retail sales rose 3% in January, the most in nearly two years, signalling robust consumer demand that could further bolster the Fed's resolve to keep raising rates.
• China's US government bond holdings hit a 12-year low in December, Treasury Department figures showed. Chinese holdings fell for a fifth month to $867 billion, bringing the decline for 2022 to 17%.
• The American oil major Chevron said on Wednesday it had agreed to sell its stake in Myanmar's Yadana offshore natural gas field to MTI Energy of Canada, sealing a long-planned withdrawal from the junta-run country.
• Japan reported a record merchandise trade deficit of ¥3.49 trillion (US$26.1 billion) in January. Merchandise exports were up 3.5% from a year earlier, but imports of oil, coal and LNG drove up overall import bills by 17.8%.
• ANA Holdings hopes that its new low-cost carrier Air Japan will be able to tempt more tourists from Southeast Asia. About 15% of all arrivals to Japan in January were from Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam. The total arrivals figure of 1.5 million was 56% of the number in January 2019.
• Rakuten Group chairman Hiroshi Mikitani says the Japanese web and fintech company intends to "flexibly consider strategic business tie-ups and the utilisation of outside capital" as part of a turnaround strategy. The company reported a record net loss of ¥372.8 billion in 2022, its fourth straight year in the red.
• A record aircraft deal by Air India has put the Tata Group-owned airline in the league of aspiring global giants. On Tuesday, it provisionally agreed to acquire 470 jets from Airbus and Boeing to take on domestic and international rivals, while options could bring total purchases to 870 planes.
• Most Adani Group stocks rose yesterday as the Indian conglomerate took steps to restore investor confidence after a short-seller attack wiped out tens of billions of dollars in investor wealth. The group says its revised focus will be on bolstering its financial health rather than aggressive expansion and capital expenditure.
• A rally in Bitcoin on Thursday took the token close to $25,000 for the first time since August amid broad gains in crypto markets as investors shook off concerns about a US regulatory clampdown.
• The Philippine central bank increased its benchmark rate by another 50 basis points to 6% on Thursday, sustaining the pace of outsized moves after inflation in January continued to rise.
• Indonesia's central bank held its key interest rate unchanged at 5.75% on Thursday, saying the current level should be sufficient to guide inflation back to its target range later this year.
• Thai steelmakers are worried about an influx of cheap steel products from Russia, following sanctions on Moscow for its invasion of Ukraine. With European markets closed, Russia is seeking new buyers and China has made purchases. Lower steel consumption in China opens the possibility of surplus products being shipped from China to other countries.
• PTT Exploration and Production Plc (PTTEP) is expanding its footprint in Malaysia through a joint venture with the Malaysian state energy group Petronas and Petroleum Sarawak Exploration & Production (PSEP) in petroleum block SK325, located off the coast of Sarawak state in northern Borneo.
• The industrial estate developer Amata Corporation Plc (AMATA) and B.Grimm Power Plc (BGRIM) are conducting a feasibility study for the construction of Amata European Smart City, expected to serve European companies investing in the Eastern Economic Corridor (EEC).
• B.Grimm Power plans to supply electricity from renewable sources to TNB Power Generation Malaysia in an effort to promote the Asean Power Grid project.
• The Thailand Industry Sentiment Index (TISI) rose to a 43-month high of 93.9 points in January, from 92.6 points in December, as businesses benefited from the "Shop Dee Mee Khuen" tax rebate, the tourism recovery and China's reopening.
• Tourism operators are concerned about the transparency of the Tourism Promotion Fund, which could reach 13 billion baht by the end of 2024 from collection of new tourist fees. A 300-baht fee for international visitors arriving by air and 150 baht for arrivals by land and sea will take effect in June.
• India's decision to scrap a negative Covid test requirement for travellers from Thailand this week should accelerate the tourism recovery amid a sluggish Chinese market, says the Tourism Authority of Thailand. It has upgraded its target for Indian arrivals from 1.4 million to 2 million this year, the same as in 2019.
• Forth Smart Service Plc (FSMART), the country's largest top-up machine provider under the Boonterm brand, is preparing to launch EV charging kiosks that will accept QR code payment via mobile banking, a first in Thailand.
• Property Perfect Plc plans to launch 14 new projects worth a combined 17.7 billion baht this year, with a goal of 60% growth in revenue to 16 billion baht. A key driver will be low-rise houses as demand in the segment remains robust, it said.
• The domestic price of diesel will be reduced by 50 satang a litre from Wednesday, from 34.44 baht now, as global crude oil prices keep decreasing, says the Oil Fuel Fund Office.
• Energy officials may keep the power tariff, which determines electricity bills, unchanged or even trim the rate for the May-August period as gas prices are falling. LNG spot prices in Asia last week were around $17 per metric million British thermal units, down from $35-40 during the fourth quarter of last year.
• Thailand's retail industry is expected to grow by 6-8% this year, double the rate of GDP, helped by the tourism recovery, the Thai Retailers Association (TRA) said, noting a strong revival in Phuket, Samui and Pattaya.
• Asset World Corp Plc (AWC) plans to build new riverfront projects near its flagship Asiatique open-air mall, starting with an investment of 800 million baht to refocus the complex as an entertainment hub.
• Siam Piwat Co is investing 3 billion baht in a "transformation project" for its Siam Paragon flagship that will reinforce its positioning as one of the most-visited global retail destinations.

COMING UP: The People's Bank of China will announce its prime lending rate on Monday. Tuesday brings the preliminary manufacturing and services purchasing managers index (PMI) for the euro zone for February, and the ZEW economic sentiment index. The US will also release PMI updates and January used home sales.

• On Wednesday, the US Federal Reserve will release the minutes of its Jan 31 policy meeting. Locally, the Fiscal Policy Office will release an update on Thai economic conditions as well as confidence in the regional economy.

STOCKS TO WATCH: Asia Plus Securities still recommends China reopening plays, among them BEM and AOT. It also likes stocks that reported growth in Q4 earnings, such as CPN and CRC; high-dividend stocks like BAM, AP, SAPPE and TU; and shares that appear to have bottomed out, including BGRIM and PTTGC.

• Kasikorn Securities recommends stocks that benefit from baht depreciation such as ITC; stocks that expect to report good Q4 performance, including PRM, CPN and BE8, as well as defensive stocks such as AP, BRI and ADVANC.

TECHNICAL VIEW: InnovestX Securities sees support at 1,645 points and resistance at 1,680. Capital Nomura Securities sees support at 1,637 and resistance at 1,670.