Asia Wealth Securities (AWS) released an analysis for the trading session on October 27, 2020, indicating the essential events in the stock market as follows:
The overall investment today – AWS expects the SET today (27 Oct) to have negative sentiment, depressed by the COVID-19 situation which is more severe in both the U.S. and Europe that are negative factors on the investment.
While the economic expansion and the demand for crude oil, including the uncertainty in the new stimulus package of the US, as well as, the SET Index is also under pressure from domestic political factors.
Although there is an extraordinary session of Parliament open to receive opinions from senators and senators, but not in accordance with the demands of the protesters. (The resignation of the Prime Minister, the Constitutional Amendments and stop harassing people).
For investment strategies, AWS recommend reducing your investment portfolio to reduce the risk and focusing on investing in AWS Core Investment, short-term, speculative and the stocks benefiting from a long-term decline in crude oil prices, recommend gradually accumulating Dividend play and DCA stocks.
The COVID-19 situation abroad is on the rise again, data from Worldometers said that the U.S. had an increase of 231,026 new cases on Monday, while France, Spain, Italy and England have announced new tightening measures to contain COVID-19 that returned to spread rapidly across the continent after the increasing the number of new infections daily, it is again in the top 10 in the world which France announced a curfew.
While Italy has limited restaurant hours and bars until 24 Nov, and Spain declared a state of emergency for 15 days. From these issues, it will negatively impact the overall investment and the price of crude oil.
The latest crude price dropped due to (1) the global situation of COVID-19 is becoming more severe again which is depressing crude oil demand.
(2) the growing supply concerns as OPEC+ will add another 2 million barrels per day of oil production from January 2021.
(3) Libya’s capacity increased to 1 MBD by the end of 2020 and 1.2 MBD in 2021.
(4) the U.S. economic stimulus measures are still lagging longer than expected.
From these issues, the investment strategy chooses to invest in stocks that benefit from falling crude oil prices following AWS Core Investment.
Technical View – Today, AWS expects the SET Index to move between 1,191-1,222 points. The recommended stocks are AI, AP, KAMART, AMA and ALL.
1) Benefit from lower crude oil price – CK, ITD, STEC, UNIQ, SCC, TOA, TASCO, GULF, BGRIM, GPSC, EPG, OSP and BJC
2) Dividend Play (Middle-term trading 6-12 months) – KKP, TISCO, QH, LH, SC, ORI, NOBLE, DIF, INTUCH, HANA, SCCC, EASTW and TTW
3) Long-term accumulative stocks (DCA) (Long-term trading over 1 year) – ADVANC, AOT, BDMS, BEM, CPALL, DIF and PTT