Recap: Asian and European shares rallied on Friday as investor confidence was restored following China's reassurance of no retribution when new American tariffs take effect tomorrow. Sources in Washington say negotiations are still expected to take place sometime in September. Analysts expect US President Donald Trump will want to strike a trade deal with Beijing soon in order to improve his 2020 re-election chances.
The SET index moved in a range of 1,609.40 and 1,639.17 points before closing at 1,654.92, up 0.5% from the previous week, in turnover averaging 60.72 billion baht a day. Institutional investors were net buyers of 5.9 billion baht and retail investors bought 2.5 billion. Foreign investors were net sellers of 5.7 billion baht and brokerages offloaded 2.7 billion in shares.
Newsmakers: French President Emmanuel Macron said G7 members had reached an agreement on the taxation of tech giants, a long-standing subject of friction between France and the US, which has threatened to retaliate with tariffs on French wines.
- Prime Minister Boris Johnson's decision to suspend Parliament next month has brought a fresh wave of confusion to Britain's already chaotic efforts to leave the EU, increasing the odds of a no-deal Brexit on Oct 31.
- Markets perked up on Thursday after President Donald Trump said US and Chinese officials were preparing to have a "conversation" about trade and Beijing's top negotiator called for "calm".
- Oil prices headed for their biggest weekly gain since mid-July after a big drop in US crude inventories and an apparent pause in US-China trade hostilities eased demand fears. Futures in New York are up 3.7% for the week.
- The second corruption trial of former Malaysian prime minister Najib Razak started on Wednesday with a prosecutor alleging he pilfered billions of dollars from the state investment fund 1MDB through an "elaborate charade" and then sought to cover his tracks.
- Indonesian President Joko Widodo confirmed that the country's capital would be moved from overcrowded Jakarta to East Kalimantan province on the eastern part of Borneo, with a target date of 2024.
- South Korea's Supreme Court on Thursday overturned a high court ruling that spared Samsung Group de facto leader Jay Y Lee from jail, while it also sent a corruption case involving jailed former president Park Geun-hye back to a lower court, in a ruling that could lead to heavier sentences.
- An Oklahoma judge ordered US health care giant Johnson & Johnson on Monday to pay US$572 million in damages for its role in fostering the state's opioid addiction crisis.
- CP Group patriarch Dhanin Chearavanont of Thailand is the latest business leader to call for an end to the violence in Hong Kong with advertisements in local newspapers, joining local tycoons lamenting the economic fallout from the months-long unrest.
- Foreign holdings of Thai equities in June rose to or 5.15 trillion baht, or 30% of market capitalisation, up from 29.5% in May, reflecting a recent share price rally and net offshore inflows worth 54 billion baht between April and June.
- Thailand's stock market outlook has a limited upside gain going forward as the country's economic slowdown and external headwinds continue to keep investor confidence at bay, says SCB Securities.
- The Bank of Thailand has delayed imposing a standardised debt-service ratio (DSR) calculation from the final quarter of this year, hoping to help low-income earners access loans amid the sluggish economy.
- The Finance Ministry has enough fiscal space available for additional stimulus measures if needed to avert recession, says Finance Minister Uttama Savanayana.
- The cabinet on Tuesday approved 59 billion baht worth of price guarantees and subsidy schemes for rice and oil palm.
- Exports are expected to experience the biggest drop of the year this quarter, marred by rising Sino-US trade tensions and shifts in the global supply chain, says a Krungthai Bank economist.
- Domestic consumption weakened in July, weighed down by retaliatory tariffs between the US and China as well as the country's lingering drought, says the Fiscal Policy Office.
- The manufacturing production index in July dropped 3.23% from a year earlier, dragged down by lower production of cars, petroleum and steel.
- Tourist arrivals rose 4.7% in July from a year earlier, after rising 0.9% in June, with 3.33 million tourists spending about 167.3 billion baht.
- The Public-Private Partnership committee has proposed the Board of Investment revise incentive criteria to enable public-private joint investment in social infrastructure projects to attract investors.
- The Industry Ministry plans to talk with the Finance Ministry on Tuesday to extend the debt payment period for sugarcane farmers by another 4-5 years for debts coming due this year.
- The Social Security Fund is preparing to propose increasing contribution rates in order to create a large pension pot to accommodate the growing number of retirees in the country.
- General Motors Thailand has cut a further 327 jobs at its Rayong plants as part of a plan to reduce operating costs and slim down the manufacturing facility.
- After posting a net loss of 190 million baht for the first six months of the year, SET-listed Bangkok Airways Plc (BA) plans to tighten its belt in hopes of turning a profit this year.
- SET-listed Energy Absolute Plc (EA) plans to start production of bio-hydrogenated diesel and phase change materials in Rayong by March 2020 after postponing the scheduled start of operations by almost a year.
- Siam Commercial Bank (SCB) has tightened credit card approval rules for vulnerable groups in line with central bank guidance aimed at controlling asset quality of unsecured loans and lowering household debt.
Coming up: China and Germany will release August manufacturing PMI data on Monday, followed by the US on Tuesday. Australia will second-quarter GDP data on Wednesday and Canada will announce July trade figures.
- On Thursday, Australia will release July trade data and the US will release August non-manufacturing PMI.
- The euro zone will release its final revision of second-quarter GDP on Friday, Canada will release August employment data and the US will release August non-farm payrolls. China will release August trade figures on Sunday.
Stocks to watch: Bualuang Securities suggests stocks benefiting from direct investment privileges by the Board of Investment such as WHA, AMATA, ROJNA, FPT and NNCL. As well, new measures to support tourist arrivals should help AOT, CENTEL, ERW, MINT and VRANDA.
SCB Securities recommends domestic plays shielded from the impact of the Sino-US trade war, such as BJC, OISHI, BTS, BCH and RJH. Recommended high-dividend stocks are DIF and JASIF, and industrial land picks are AMATA, ROJNA and WHA.
Technical View: Asia Plus Securities sees support at 1,600 points and resistance at 1,655. Capital Nomura Securities sees support at 1,623 and resistance at 1,655.
