Analysts addressed their concern over anti-government protests escalated, suggesting to invest in less affected stocks such as the electronics sector, foods sector and retails.
Maybank Kim Eng (Maybank) stated that the Thai stock market is now weaker than the regional market due to political tension at risk of deadlock, causing downside pressure in the short term and foreign investors’ mass sell-offs.
Maybank expected Thai stock market to continue downward if the situation remained unchanged. Among others, the industrial sector would be the worst impacted sector driven by the exodus of foreign investors.
For the investment strategy, recommending to invest in less affected stocks such as 1) the electronic components sector including KCE driven by an upside of the technology sector. 2) The food sector especially export food business such as TU to be benefited from the FX rate, analyst expected TU 3Q20 profit to be better than a year ago. 3) The retail sector such as COM7, RS and SINGER, thanks to government stimulus measures.
Trinity Securities (Trinity) said that the current political issue in Thailand unsignificantly impacted the stock market, advising to invest in small-mid cap stocks due to a better potential of profit growth, moreover, those do not attract foreign investors and domestic institutional investors.
In addition, suggesting 3 sectors to stay strong amid tension consisted of the electronic components sector, food sector and agriculture stocks.
Asia Plus Securities (ASP) assessed political issues to weigh significantly on Thai stock market, as politics is the principal factor driving and influencing country economy, the relation that could not be separated. As the Free Youth Movement and People’s Party protest escalated and flared nationwide, investors have to keep monitoring closely.
ASP suggested to focus on holding 35% of cash and invest 65% in high dividend yield such as DCC, JMART, MCS and Global Play stocks such as TU and PTTGC.