Asia Wealth Securities (AWS) released an analysis for the trading session on June 30, 2020, indicating the essential events in the stock market as follows:
Investment Overview Today – AWS expects the SET Index to recover according to the Dow stock market that increased by 2.3%. However, the investment still needs to be cautious as there are many factors (COVID-19 in foreign countries and valuation) as well as no new positive factors to support the investment. The investment strategies during volatile markets today, AWS focus on stocks that have specific positive factors in each area, such as phase 5 lockdown relaxation, tourism stimulus measures and the bidding for the Orange Line as well as shares in the defensive stock under the theme investment (DCA).
CCSA extends Emergency Decree / relaxes phase 5 / opens 9 border crossing points – Large-scale of CCSA approved extension period for Emergency Decree for another month (ending 31 July) as according to the small-scale of CCSA that proposed previously, supporting the relaxation of the phase 5 lockdown measures (back to school on 1 July) and the opening of 9 crossing points to transport. Yesterday, the CCSA reported 7 additional cases in State Quarantine, which was a group of Thai people traveling from abroad. The cumulative number of infected people has increased to 3,169 and there are no people infected in the country for 35 consecutive days. AWS looks positively to CPALL, SPA, SISB, MAJOR, CRC, CPN, SF, and HMPRO.
Follow up on tourism stimulus measures – Today, the cabinet will consider and approve tourism stimulus measures. (Encouragement – AWS goes together – The travel to share happiness) with the budget limit of Bt22.4bn (from the Royal Thai Loan Bt1.0tn) which all 3 measures have the period for 4 months (July – Oct 2020) so that AWS has the positive view for AOT, AAV, ERW, MINT, and CENTEL.
Opening the timeline of the Orange-Line which expected to sign by the end of 2020. AWS chooses CK and BEM – MRTA has the schedule for the auction of the MRT Orange Line both the road work along the route (Bang Khun Non – Min Buri (Suwinthawong)) and the construction phase of the Cultural Center – Bang Khun Non, totalling Bt120bn which MRTA will announce the invitation between 3-9 July and sales documents (Request for Proposal: RFP) between 10-24 July and is scheduled to submit a proposal within September 2020, which is expected to sign the joint investment agreement within December 2020. From this point, AWS chooses CK and BEM as the stocks that obtain the benefit from this issue.
The key of economic data for the U.S. this week – Purchasing Managers Index (PMI) in June, Consumer Confidence Index in June (Conference Board), Manufacturing production index in June from the Supply Management Institute for the U.S. (ISM), the Monetary Policy Committee of the Federal Reserve (FOMC), Non-farm payrolls in June, the number of weekly jobless claims, the Unemployment rate in June and the trade balance in May.
Technical View – Today, AWS expects the SET Index to move in a range of 1,319 – 1,341 points (support at 1,325 1,319 and 1,307 points and resistance at 1,335 1,341 and 1,352 points). The recommended stocks are BCH, TOA, KCE, ORI and TQM.
1) Accelerate the disbursement of government investment budget – CK, STEC, SEAFCO, PYLON, and TASCO
2) Stocks that benefit from entering the rainy season – BCPG, BGRIM, CKP, GPSC, and EASTW
3) Stocks that benefit from government measure – ADVANC, BTS, BEM, CPF, CPALL, BJC, CRC, CPN, PLANB, HMPRO, OSP, and CBG (4) Long-term cumulative shares (DCA) – ADVANC, AOT, BDMS, BEM, CPALL, DIF, and HMPRO
5) SSFx target stocks – PTT, PTTEP, BJC, CPALL, AOT, GULF, EGCO, INTUCH, ADVANC, BAM, and BDMS