Asian markets mixed but SET sees correction

RECAP: Asian markets were mixed yesterday, with traders still preoccupied by interest rate worries, though Tokyo rallied after the man tipped as Japan's next central bank head made the case for keeping its ultra-loose policy.

The local stock market underwent a correction following hawkish US Fed minutes and falling oil prices. The SET Index moved in a range of 1,631.54 and 1,669.51 points on the week before closing yesterday at 1,634.02, down 1.1% from the previous week, in daily turnover averaging 62.44 billion baht.

Foreign investors were sellers of 14.41 billion baht. Retail investors were net buyers of 6.98 billion baht, followed by institutional investors at 6.72 billion and brokers at 703.16 million baht worth of shares.

NEWSMAKERS: Nearly all US Federal Reserve policymakers supported further slowing the pace of interest-rate increases at their last meeting, minutes showed this week. But they also cautioned that inflation is still unacceptably high.

• US fourth-quarter growth was weaker than previously estimated, reflecting a downward revision to consumer spending. Inflation-adjusted GDP increased at a 2.7% annualised rate, new data showed on Thursday, down from 2.9% estimated earlier.
• Kazuo Ueda, the man nominated as the next Bank of Japan governor, told legislators yesterday that he believes it is "appropriate" to continue monetary easing, but he aims to mitigate the side effects. The comment echoes remarks made a day earlier by governor Haruhiko Kuroda.
• The International Monetary Fund has laid out a nine-point plan for how countries should treat crypto assets, with point number one being that cryptocurrencies such as bitcoin should not be given legal-tender status.
• Worldwide shipments of PCs, tablets and mobile phones are projected to decline by 4.4% this year to a total of 1.7 billion units, according to Gartner Inc. The downturn would be the second consecutive year of reduced demand, it said.
• Alibaba reported better-than-expected quarterly revenue on Thursday, helped by cost cutting and eased Covid curbs in China. Revenue of the e-commerce giant rose 2% to 247.8 billion yuan (US$35.9 billion) for its fiscal third quarter. Net profit rose 69%to 46.8 billion yuan.
• CapitaLand Investment, the Singapore government-backed property manager, has launched two funds worth more than S$1.6 billion, banking on a strong rebound of China's real estate market.
• The European Commission is suspending the short video-sharing app TikTok from employees' corporate phones, citing a focus on cybersecurity.
• President Vladimir Putin said on Wednesday that Chinese President Xi Jinping would visit Russia, saying relations had reached "new frontiers". Russian officials say bilateral trade has been better than expected and could soon reach $200 billion, up from $185 billion in 2022.
• Core consumer inflation in Japan hit a fresh 41-year high of 4.2% last month as companies passed on higher costs to households, keeping the central bank under pressure to phase out its massive stimulus programme.
• Nippon Steel will pay around C$1.15 billion (US$850 million) to acquire a 10% stake in the coking coal business of the Canadian mining company Teck Resources, as it seeks high-quality coal for a steelmaking to reduce environmental impact.
• Toyota Motor will start producing electric vehicles in the US state of Kentucky as early as 2025, to capitalise on government incentives in the US, which accounts for one-fifth of its global sales.
• The Singapore-based super-app firm Grab expects to deliver its first profit on an adjusted Ebitda basis in the last quarter of 2023, sooner than it had forecast earlier, after cutting earnings-draining incentives. It said its annual loss narrowed to $1.74 billion in 2022, a 51% improvement from a year earlier.
• Hong Kong's finance chief unveiled a HK$761-billion (US$97 billion) budget on Wednesday, hoping to kickstart the economy with tax cuts and offering consumer spending vouchers.
• The National Economic and Social Development Council has downgraded its 2023 Thai economic growth forecast to a range between 2.7% and 3.7%, from 3-4% estimated in November, largely attributed to the global slowdown and declining exports. It expects export value in dollar terms to fall 1.6% this year, compared with 5.5% growth in 2022.
• Prime Minister Prayut Chan-o-cha said on Tuesday he expects the House to be dissolved early next month, paving the way for a general election that must be held by May 7.
• Thailand has become the world's second-largest producer of bioplastic products after the US, thanks to plenty of raw materials to drive manufacturing. Manufacturers plan to increase annual production capacity by 75,000 tonnes from the current total of 95,000 tonnes.
• Global Green Chemicals (GGC), the biochemical arm of PTT Global Chemical, has allocated a capital budget of 2.5 billion baht to develop new oleochemical-based products to earn more revenue. Oleochemicals are a feedstock for cosmetic products and some food supplements.
• The cabinet on Tuesday approved another 81.2 billion baht of new borrowing in fiscal 2023, mostly to cover fuel subsidies. The Oil Fuel Fund has run up losses of 130 billion baht, mainly from subsidising the prices of diesel and cooking gas in a bid to slow inflation.
• PTT Oil and Retail business (OR) plans to allocate capital spending of 31.2 billion baht to its businesses in Thailand and overseas. Up to 45% of the budget, or around 14 billion, would go to non-oil and lifestyle businesses, including adding 400 Cafe Amazon outlets and adding more Texas Chicken outlets in 12 countries.
• Thai banks' non-performing loans dipped to 2.73% of total lending at the end of December 2022, from 2.77% in September, helped by debt restructuring.
• BCPG, the clean-power generation arm of the energy conglomerate Bangchak Corp, is expanding in the US by investing 3.9 billion baht in two gas-fired power plants in Ohio.
• Central Retail Corporation (CRC), the country's biggest retailer, has unveiled its largest investment in Vietnam, totalling 50 billion baht from 2023-27 to expand its market presence there.
• Siam Commercial Bank (SCB) aims to become a universal digital bank and upgrade its mobile banking platform to be No.1 in wealth management services.

COMING UP: On Monday, the European Union will release euro zone consumer confidence and the US will report pending home sales for February. On Tuesday, Japan will release January retail sales and industrial production, while the US will report February consumer confidence. On Wednesday, China and the euro zone will report manufacturing and services PMI updates.

• Locally, the Bank of Thailand will update economic data on Tuesday, which is also the last day of earnings season on the SET.

STOCKS TO WATCH: InnovestX Securities recommends stocks with good Q4 earnings growth, among them BDMS, ZEN, BJC and LH. Also interesting are shares expected to be less prone to foreign selling pressure, such as SCC, AMATA and ERW.

• Kasikorn Securities recommends stocks that will benefit from the election, including commerce, consumer, ICT, media and construction plays. Among them are CPALL, ADVANC, OSP and STEC.

TECHNICAL VIEW: Kasikorn Securities sees support at 1,605 points and resistance at 1,666. Pi Securities sees support at 1,630 and resistance at 1,650.