Asia Wealth Securities (AWS) released an analysis for the trading session on August 26, 2020, indicating the essential events in the stock market as follows:
Investment Overview Today – AWS expects the SET Index to be volatile after rising 19.2 points (+1.48%) over the past 2 business days. Investors must watch out for profit taking on stocks in the sector that have benefited from positive factors over the past two days. However, AWS still believes the positive sentiment is interesting in investing in energy and petrochemical stocks from the Hurricane Season in the U.S. that has affected Gulf petroleum production in Mexico will still be a supporting factor in the short-term.
The energy sector obtained the benefit factor from the Hurricane Season, AWS looks at it as a short-term positive – the Bureau of Safety and Environmental Enforcement (BSEE) report that the tropical Laura and Marco hurricane moves into the Gulf of Mexico, as a result, oil companies in the Gulf of Mexico have cut offshore oil output by 84.3%to 1.6 million barrels per day. As well as impacting gas production capacity up to 61%. Besides, there are also some interesting issues at the U.S. crude oil reserves weekly report By the United States Energy Information Agency (EIA), which will report today (26 Aug) at 9:30 PM, while the S&P Global Platts survey expects that the U.S. crude oil reserves will down 4.3 million barrels in the past week. (Ended 21 August) so that AWS estimates this as a short-term positive sentiment only to investing in energy stocks (PTT, PTTEP TOP, BCP, IRPC, SPRC and PTTGC) as well as positive for the U.S. gas prices (Henry Hubs), the latest Henry Hubs price is USD2.52 per million BTU which will positive for BANPU.
The cabinet approves VAT for another one year, AWS believes that it is not a factor to support investment – Yesterday (25 August), the Cabinet approved the proposal of the Ministry of Finance to maintain the value added tax rate (VAT) at 7% for another 1 year (1 October 2020 to 30 September 2021) in order to reduce the cost of living for people and build confidence in doing business for the private sector so it will result in the economic recovery of the country after the situation of COVID-19 epidemic.
The U.S. Economy report – S&P Corrugated Case Chiller survey shows that the U.S. domestic house price index in June rose 4.3%YoY, in line with May, while the U.S. Commerce reports that new home sales rose 13.9%MoM to 901,000 units in July, the highest level since December 2006 and higher than expected at 785,000 units.
Today’s key economic statistics report –the U.S. key economic report which are the Goods Trade Balance Report in July, the Core Durable Goods Orders in July (expected to increase 2.0%MoM), the Durable Goods Orders in July (Market Expected to increase 3.3%MoM) and Crude Oil Inventories Weekly Report.
Technical View – Today, AWS expects the SET Index to move between 1,308 – 1,323 points. (Support at 1,312 1,308 and 1,300 points and resistance at 1,319 1,323 and 1,331 points). The recommended stocks are ADVANC, KTC, AWC, CPN and ORI
1) Benefit from a successful vaccine development in the near future (Short term trading 1 month) – AOT, AAV, BA, ERW, M, CENTEL and MINT
2) Benefit according to the season (Short term trading 1-2 months) – BGRIM, CKP and GPSC
3) Benefit from the stimulus package (Short term trading 1-3 months) – CPALL, CRC, HMPRO, BJC, OSP, CBG, MTC, CK, BEM, SEAFCO, PYLON, TASCO, COM7 and WHA
4) Dividend Play (Middle term investing 6-12 months) – KKP, TISCO, QH, LH, ORI, NOBLE, DIF, INTUCH, HANA, EASTW, TTW, EGCO and RATCH
5) Long-term cumulative shares (DCA) (Investing more than 1 year) – ADVANC, AOT, BDMS, BEM, CPALL, DIF and PTT