Market Roundup 1 July 2022

1) Thai stock market overview

Thailand’s SET Index closed at 1,572.67 points, increased 4.34 points or 0.28% with a trading value of 49 billion baht. The analyst stated that the Thai stock market moved up and down in a narrow range without new positive drivers, but got a boost by a buying power in CPALL. The analyst expected the SET Index next week to move narrowly down as the US stock market will be closed on national day.


2) Eurozone inflation hits fresh record of 8.6% in June

Inflation in the eurozone reached a fresh record high of 8.6 percent in June, ahead of the European Central Bank’s first rate hike in 11 years.

According to preliminary data released on Friday by the European statistics office Eurostat, annual headline inflation for the month of June was at 8.6 percent, up from May’s reading of 8.1 percent, and higher than a prediction of 8.4 percent in a Reuters poll of economists.

The figure shows that the cost of living in eurozone nations is continuing to rise.


3) Putin signs a decree to take over LNG plant in a counter move against the west

The Russian President Vladimir Putin on Thursday added fuel to an economic war with the western countries by signing a decree to seize full control of the Sakhalin-2 gas and oil project in the far-eastern Russia.

This fresh decree will create a new firm to take control of all rights and obligations of Sakhalin Energy Investment Co, which is held by Shell (RDSa), Mitsui and Mitsubishi with just under 50% stake. Meanwhile, state-run Gazprom is now holding a 50% plus one share stake in Sakhalin-2, which produces about 4% of the world’s liquefied natural gas (LNG).

The move could force Shell and the two Japanese corporates out, adding more volatility in the already tight LNG market.


4) Japanese Industrial Mood Drops for 2nd Straight Quarter in June

Japanese business sentiment dropped for the 2nd straight quarter in June amid rising costs for energy and raw materials and supply disruptions caused by China lockdown, the Bank of Japan (BOJ) said in its Tankan report Friday.

The Tankan’s headline index, which measures the mood of big manufacturers, fell to plus 9 in June from plus 14 in March, the lowest level since March 2021. By comparison, the median market forecast was about a 13 point gain.

BOJ said that rising raw material costs, supply shortage resulting from lockdown in China’s key financial hub Shanghai, and auto production reduction were among the factors listed by manufacturers as hurting their operations.

Sentiment has also been hampered by the yen’s recent weakness against major currencies, including the U.S. dollar and the euro, which has increased the cost to import raw materials.