Market Roundup 17 October 2022


1) Thai stock market overview

Thailand’s SET Index closed at 1,571.40 points, increased 10.62 points or 0.68% with a trading value of 66 billion baht. The analyst stated that the Thai stock market performed better than regional markets as investors speculate on the bank’s earnings session after a positive sign from TISCO, coupled with buying power in retail stocks as pressure on flooding eased. The analyst expected the market to move sideways tomorrow with a support level at 1,565-1,560 points and a resistance level atr 1,580 points.


2) China suspends LNG exports to secure supply for winter

China ordered its state-owned gas importers to halt reselling LNG to energy-starved clients in Europe and Asia to safeguard its winter heating supplies, according to Bloomberg reported on Monday.

Unnamed sources familiar with the matter said that the National Development and Reform Commission requested that PetroChina Co., Sinopec, and Cnooc Ltd. hold onto winter cargoes for domestic consumption.

Forecasts for a slight gas supply imbalance likely prompted Beijing’s move, which has promised to keep its citizens warm this winter. The resales marked a significant shift for China, which overtook Japan to become the world’s largest LNG importer last year due to growing spot market purchases but may experience its first ever dip in gas consumption in 2022.


3) BOT deems moderate rate hikes appropriate for now

Thailand’s economy will continue to recover this year and in 2023, and gradual interest rate hikes remain appropriate, however policy can be changed if the outlook differs from expectations, according to the Bank of Thailand on Monday.

The central bank has predicted GDP growth of 3.3% for this year and 3.8% for next year.

The bank stated that the economy posed no significant risks, and that monetary policy would bring a recovery without increasing inflationary pressures.

BOT expects a modest decline in inflation beginning in the fourth quarter of this year.

A rebound in the tourism sector will be key to the recovery of the Thai economy, the BOT added.


4) FSS expects loan growth to support Thai bank’s earnings in 3Q22

Finansia Syrus Securities (FSS) expected Thai bank’s earnings season for 3Q22 to decrease by 1% on a quarterly basis due to seasonality. However, the sector would jump by 24% on a yearly basis due to healthy loan growth (+4% Y-Y) and significantly lower provisioning, which should help offset lower non-NII and higher operating expenses.

FSS believed NIM will widen in the future, in line with the economy and the rate uptrend, while asset quality should remain manageable. Also, banks have set aside provisions in advance. FSS maintained its Overweight rating on banks BBL and KTB as its top picks.