Asia Wealth Securities (AWS) released an analysis for the trading session on October 15, 2020, indicating the essential events in the stock market as follows:
The overall investment today – AWS expects the SET Index today (15 Oct) to have a continued decline after the Prime Minister announced the adoption of the Civil Service Commission in an emergency situation, especially in Bangkok area and ready to hold the leaders of the crowd, including negative factors from abroad from increasing uncertainty after the U.S. stimulus measures may delay and shortly after the election on 3 Nov, AWS expects the market to drop to the support level in AWS forecast of 1,244 points.
For investment strategy, AWS recommends investing in stocks with positive factors, stocks that are expected to grow in 3Q20 include BEM, TU, CPF, HANA, KCE, ICHI, WICE and SAPPE, and stocks that benefit from the government stimulus package following AWS Investment Theme. While oil prices increased, AWS keeps the same view, recommending short-term speculation only.
Crude oil prices continue to recover gradually – Crude oil prices have increased after the JMMC of OPEC+ was able to comply with the production cut agreements in September, however, crude price hikes were limited after the International Energy Agency (IEA) cut its 2020 oil demand forecast amid the COVID-19 epidemic.
This has hit the global aviation industry. IEA expected that oil demand at 91.7 million bpd in 2020, down 8.4 million bpd (formerly 8.1 million bpd), reflecting the persistent risks. As a result, AWS recommends only speculation in the energy sector (PTT, PTTEP, TOP and PTTGC).
The U.S. economic stimulus measures still need time so it will be negative factor to investment – The Treasury Secretary admits that it is difficult to reach an agreement to issue the U.S. economic stimulus measures ahead of 3 Nov (presidential election) which Democrats and Republicans continued to disagree on a number of issues, including the limit of such measures.
Previously, the President of the United States House of Representatives rejected the White House’s USD1.8tn offer, saying it was insufficient to mitigate the effects of COVID-19. While Democrats are offering USD2.2tn.
Technical View – Today, AWS expects the SET Index to move between 1,244-1,274 with the recommended stocks are SAT, CBG, TPCH, IHL and ALT.
1) Benefit from a the government measures (Shop Dee Mee Kuen, Kon La Krung and Shop Dee Mee Kuen, Kon La Krung) (Short term trading 1-3 months) – BEM, MINT, WORK, VGI, PLANB, CRC, DCC, BJC, CPALl, JMART, COM7, HMPRO, MAKRO, MTC, KTC, OSP and M
2) Laggard stocks (Short term trading 1 month) – BAM, BDMS, BEM, CPALL, GPSC, MTC and WHA
3) Dividend Play (Middle term investing 6-12 months) – KKP, TISCO, QH, LH, SC, ORI, NOBLE, DIF, INTUCH, HANA, SCCC, EASTW, TTW,
4) Long-term cumulative shares (DCA) (Investing more than 1 year) – ADVANC, AOT, BDMS, BEM, CPALL, DIF and PTT