Market Roundup 25 July 2022

1) Thai stock market overview

Thailand’s SET Index closed at 1,560.31 points, increased 7.58 points or 0.49% with a trading value of 57 billion baht. The analyst stated that the Thai stock market was able to close higher after the non-confidence motion last week, easing some political tension for the government. Meanwhile, the Bank of Thailand expected more than 3% economic growth in 2Q22 and assured that the rate hike will be gradual and not derailing economic recovery.


2) Maybank sees Thai banks continue on positive note

Maybank Securities (Thailand) (MST) maintains its positive view on the banking sector, despite the perceived macro headwinds, and it expects earnings to expand by 16 percent year-on-year in 2022. Interest rate rises are expected to benefit big banks such as KBANK, KTB, and KKP.

MST expects KKP and KTB to outperform its 2022 earnings prediction because their 1H22 earnings exceeded 60% of their full-year forecast. SCB may outperform the SET in the short term, since 2Q results eased market concerns. Compared to KBANK, SCB’s valuation is attractive at 8x 2022 PER, which is in line with KBANK’s PER.


3) Thai Life Insurance fails SET50 inclusion

Thai Life Insurance Public Company Limited (SET: TLI) will not be included in the SET50 Index after closing THB15.90 per share on its first trading day, which failed to meet the fast-track measure criteria.

With a trading value over THB10 billion on July 25, 2022, the share price of TLI dropped below its IPO level by THB0.10 or 0.62% to close at THB15.90 on its first trading day on the SET Index.


4) BOJ board reshuffle brings in new members with less dovish stance

The Bank of Japan has reshuffled its board and added a new member who is considered as more keen to end ultra-low interest rates than his dovish predecessor, potentially shifting the board away from Governor Haruhiko Kuroda’s current aggressive monetary easing.

The reshuffle comes ahead of a change in BOJ leadership when Kuroda’s second five-year term ends in April next year.


5) China plans a 3-tier system to avoid US delistings

China aims to categorize Chinese companies listed on the US stock market into three groups depending on the sensitivity of the data the firms hold, the Financial Times reported on Saturday, in bid to prevent American regulators from delisting Chinese companies.

Four unnamed people with knowledge of the matter told the Financial Times that the three-tier approach tries to bring Chinese businesses into compliance with US regulations that compel public corporations to allow regulators to inspect their audit files.

The 3 broad categories include companies with non-sensitive data, sensitive data and secretive data.

US regulators have long requested complete access to the records of US-listed Chinese firms, but Beijing, citing national security concerns, blocks international review of working papers.