Kaohoon Morning Brief – 2 May 2023

1) FSS expects SET Index  to move narrowly with less attraction due to long holiday

Finansia Syrus Securities (FSS) expected Thailand’s SET Index to move in a sideways trend within the range of 1,520-1,540 points with only two days of trading sessions before going into another long holiday.

The takeover of First Republic Bank by JP Morgan did not post much negative sentiment in the market.

The analyst noted that investors should monitor the upcoming Fed’s meeting that is expected to raise rates by another 25 basis points.

Domestic plays should outperform global plays as the analyst recommended short-term speculation on stocks with good earnings potential.


2) JPMorgan assumes First Republic Bank’s deposits

U.S. regulators seized control of First Republic Bank on Monday and sold its assets to JPMorgan Chase & Co. This marks First Republic Bank to be the largest U.S. bank failure since the 2008 financial crisis.

JPMorgan will assume all deposits from First Republic Bank and will pay $10.6 billion to the U.S. Federal Deposit Insurance Corp (FDIC) as part of the deal to take control of most of the assets, but will not assume First Republic’s corporate debt or preferred stock.

JPMorgan said that the deal has a fair value mark on acquired loans at roughly $22 billion.


3) U.S. could default as soon as June 1st

Treasury Secretary Yellen warns that the US could default as soon as June 1st if the debt ceiling is not raised.

She noted that the US Treasury has been taking special accounting maneuvers to avoid default since January. However, this maneuver will no longer help avoid default after this month if U.S. lawmakers fail to raise the debt ceiling and a depression is likely to happen.