Asian shares advance after US tech rally

RECAP: Most Asian markets advanced yesterday amid a rebound in US shares after impressive results from tech giants. But Chinese stocks fell on disappointment with the limited impact of state policy support measures to revive the economy.

Thai shares moved in a range of 1,357.39 and 1,386.67 points this week, before closing on Friday at 1,384.08, up 1.16% from the previous week, with daily turnover averaging 44.19 billion baht.

Retail investors were net buyers of 2.26 billion baht. Institutional investors were net sellers of 2.11 billion, followed by foreign investors at 117.23 million and brokerage firms at 33.15 million baht.

NEWSMAKERS: The US Federal Reserve says inflation is "moving sustainably" towards its 2% target, but chairman Jerome Powell sought to end speculation about an interest-rate cut in March, saying such a move is "not the base case."

• The International Monetary Fund has raised its forecast for global growth to 3.1% this year, the same as in 2023, and 3.2% in 2025. US growth is expected to slow from 2.5% in 2023 to 2.1% this year and 1.7% next year. The IMF lifted its 2024 forecast for China by 0.4 points to 4.6%.
• Euro-zone inflation eased to 2.8% in January but was slightly above forecasts, testing investor expectations that the European Central Bank will begin lowering interest rates as soon as the spring.
• The Bank of England left its key interest rate unchanged at a 16-year high of 5.25%, and signalled it was in no rush to cut rates as inflation was still high at 4%.
• US job openings in December rose to 9.03 million, topping forecasts and reflecting a labour market too strong for the Fed to consider cutting rates in March.
• The People's Bank of China provided 150 billion yuan ($20.9 billion) worth of low-cost funds for lending to housing and infrastructure projects last month, stepping up support for the economy.
• China reported an increase of 16.8% year-on-year in industrial profits for December, but the full-year figure in 2023 was down 2.3%. The manufacturing purchasing managers' index (PMI) in January was 49.2, below 50 for the fourth month.
• Opec+ decided to maintain its production cuts of 2.2 million barrels per day to the end of the first quarter and possibly beyond to support prices. Saudi Arabia alone is cutting 1 million bpd.
• US oil production in November rose 0.6% to a record of 13.31 million bpd, the Energy Information Administration said.
• Meta reported a 25% increase in quarterly revenue, while profit tripled to $14 billion, fuelled by an advertising recovery. The owner of Facebook, Instagram and WhatsApp also said it would pay its first-ever dividend, of 50 cents a share.
• Apple reported sales and profits that beat Wall Street estimates, powered by growth in its iPhone business. But sales in China were down 13% year-on-year, clouding the longer-term outlook.
• China-based Contemporary Amperex Technology Co Ltd (CATL), the world's biggest maker of EV batteries, estimated its net profit for 2023 would be as high as 45.5 billion yuan ($6.3 billion), up 48% from 2022.
• A Hong Kong court has ordered China Evergrande Group to cease operations and sell assets to pay off its massive debt of 2.4 trillion yuan ($333 billion).
• The land price per square wah in Bangkok is expected to reach a record high of more than 4 million baht for a plot on Phloenchit Road owned by the Sukosol family, that is being purchased by Central Group, according to news report.
• The Federation of Thai Industries said said car exports last ear reached a five-year high of 1.11 million. It set a 2024 production target of 1.9 million cars, a 3.2% increase, with 1.15 million units for export.
• The Stock Exchange of Thailand has ordered the embattled media group JKN Global Group to clarify a shareholder restructuring and share divestiture to a strategic partner, saying the information it reported was not in line with its filings to the bourse.
• Thailand and China formally signed their visa exemption agreement, effective from March 1. It allows for visa-free travel for stays of up to 30 days and is expected to boost tourism.
• The Tourism Authority of Thailand (TAT) has asked the government to extend the visa-free stay duration for long-haul tourists, including those from the US and Europe, to 90 days.
• The Bank of Thailand said GDP growth in December and the fourth quarter slowed due to sluggish global demand and structural constraints, possibly leading to a downward revision of its 2023 GDP growth forecast from the current 2.4%.
• The BoT said the business confidence index slipped in January to 48.0 from 49.1 in December, affected by higher transport costs due to the conflict in the Red Sea and reduced orders following the year-end holiday season.
• The manufacturing production index in December fell 6.27% from a year earlier as car output declined, the Ministry of Industry said. Output contracted 5.1% for all of 2023.
• The Energy Regulatory Commission says electricity prices for the last eight months of this year will not be under 4.20 baht per unit (they are currently 4.18 baht), due to volatile fuel prices, nearly 100 billion baht in outstanding debts of the Electricity Generating Authority of Thailand, and unstable fuel supplies from the Gulf of Thailand and Myanmar.
• PTT Exploration and Production Plc is allocating a 230-billion-baht budget this year to support plans to increase gas production from the Erawan offshore block and maintain high output from two other fields in the Gulf of Thailand.
• The Government Housing Bank targets 3% growth this year in mortgage lending of 240 billion baht for the year.
• The Ministry of Finance says it is continuing with the digital wallet project, although it may be delayed beyond the initial May timeline, with no new definite schedule set.
• The Thai Furniture Industry Association expects a contraction of 10% in 2024 due to continued slow domestic demand, consumer delays in new furniture purchases, a stagnant real estate market, and competition from lower-priced imports.

COMING UP: On Monday, the Reserve Bank of Australia will hold a rate meeting and the US will release January manufacturing and services PMI updates. China will report January inflation and Germany will release industrial production data on Tuesday. Germany will release January inflation on Friday. Markets in China, South Korea, Hong Kong and Singapore will be closed on Friday for the Chinese New Year holiday. Locally, the central bank's Monetary Policy Committee meets to decide on interest rates.

STOCKS TO WATCH: Krungsri Capital Securities recommends stocks that will benefit from weakening US bond yields, including AOT, AAV, BA, CENTEL, ERW, MINT and SPA. The Thailand-China tourism visa waiver agreement, effective from March 1, will help many companies, among them BDMS, BCH, AOT, WHA, CPALL, CPAXT, BJC, CBG, ITC, AAI, AUCT, PLANB, SABINA, MC, SISB, MASTER, SNNP, SPA and MINT.

• InnovestX Securities recommends investing in high-dividend stocks projected to give returns of at least 5% in 2024, including AH, AP, BCP, KTB, PTT and TTB.
• Longer-term, the brokerage recommends dollar-cost averaging accumulation as the SET has fallen significantly and downside risks are low. Undervalued stocks are recommended, namely BBL, BDMS, BEM, CPALL, PTT and SCC.
• Trinity Securities suggests high-dividend stocks, including ADVANC, AP, BCH, INTUCH, PTT, SIRI and TISCO. The brokerage also likes stocks linked to domestic consumption and the tourism recovery, such as CPALL, CPAXT, BJC and MASTER.

TECHNICAL VIEW: Trinity sees support at 1,340 points and resistance at 1,410. Phillip Securities (Thailand) sees support at 1,340 and resistance at 1,390.