Kaohoon Morning Brief – 19 January 2023

1) Krungsri expects foreign flows to support Thai market further

Krungsri Securities (KSS) expected Thailand’s SET Index to move within the range of 1,675 – 1,695 points, pressured by weaker-than-expected US retail sales in December that dropped 1.1%, while core retail sales fell 0.7%. Meanwhile, Fed’s officials also support further rate hikes to bring inflation back to 2%. Still, KSS expected the SET Index to get a boost from foreign flows and purchasing power from individual stocks.


2) U.S. producer prices fell more than expected in December,

U.S. producer prices fell more than expected in December, dragged by the costs of energy products and food that continued to decline, which indicates that inflation is fading.

According to the Labor Department, the producer price index for final demand dropped 0.5% MoM, compared to revised data for November to show the PPI rising 0.2%.

In the 12 months period, the U.S. PPI rose 6.2% after a 7.3% rise in November.

Producer prices were lower than economists by Reuters’ poll had forecast for a 0.1% drop on the month and a 6.8% gain over the year.


3) U.S. retail sales made largest drop in December

U.S. retail sales made a biggest drop in a year in December as a decline in vehicles and other goods purchasing declined.

Retail sales fell 1.1% last month, its biggest drop since December 2021 and also a second straight monthly decline after data in November was adjusted to a decrease of 1.0% instead of 0.6% as previously announced.

The decrease was larger than a 0.8% drop forecast by economists in a Reuters poll. Still Retail sales rose 6.0% year-on-year in December.