Asia Wealth Securities (AWS) released an analysis for the trading session on March 17, 2020, indicating the essential events in the stock market as follows:
1) Dow Jones fell by 2,997.10 points (-12.93%), crude oil price dropped by USD3.03 (-9.6%) and gold price declined by USD30.2 (-1.99%).
2) The announcement of proactive safeguards in many countries to curb the spread of COVID-19 has affected the overall investment view. Most recently, the President of the European Commission (EC) proposes EU member countries to issue a ban on foreigners entering the country for 1 month, while Malaysia and the Philippines are the other 2 countries in ASEAN that announced the closure of the country.
3) Worries overshadows the confidence, reflected by global stock markets that have declined, especially the US stock market, which has experienced a circuit breaker in the market for the third time in 2 weeks. This shows concerns about the economy that is going into a recession from the current problem. Although the Fed cut interest rates by 1.00% and injected money through bond purchases according to the QE measure of USD700bn, investors still believe that this is not enough to cope with the effects of the COVID-19 pandemic.
4) This morning, Futures and Commodities markets, the Dow Future was back in positive territory. Gold price and crude oil price recovered.
5) AWS expects the market to buy back in the upstream energy sectors such as PTT and PTTEP, as well as the petrochemical and refining groups (BCP, IRPC, SPRC, ESSO, TOP, PTTGC, and IVL) after the share price dropped sharply yesterday (16 March). AWS recommends only short-term speculation which recommend PTTEP, TOP, and IVL.
6) COVID-19 does not affect retail and food groups, especially the current situation in which people around the world began to stock up on food as a concern for COVID-19 pandemic, AWS chooses TU, GFPT, CPF, TFG, BJC, and CPALL as well as TQM (Insurance group).
7) Today, AWS expects the SET to be within the range of 1,004- 1,065 points (with support at 1,025 1,004 and 964 points and resistance levels at 1,065 1,086 and 1,126 points).
(1) Accelerate the disbursement of government budget in 2020. AWS chooses CK (TP Bt22.00), SEAFCO (TP Bt7.30), WHA (TP Bt4.40), and KKP (TP Bt80.00).
(2) Government stimulus measure, AWS favours AOT (TP Bt79.00), CPALL (TP Bt85.00), BEM (TP Bt12.50) and HMPRO (TP Bt19.00).
(3) Global trade has eased, AWS chooses CPF (TP Bt33.00).
(4) Interest rates cut. AWS chooses ORI (TP Bt9.00), SPALI (TP Bt20.00), MTC (TP Bt73.00), KKP (TP Bt80.00), and TISCO (TP Bt112.00) and
(5) High Dividend, AWS chooses KKP (Div.Yld.11.3%), QH (Div.Yld. 8.7%), DIF (Div.Yld 8.2%), TISCO (Div.Yld. 7.9%), BAFS (Div.Yld. 5.6%), RATCH (Div.Yld. 4.1%) and ADVANC (Div.Yld. 4.8%)