Mr. Koraphat Vorachet, Head of Investment Strategy of Krungsri Capital Securities (KCS), stated via “Kaohoon Jor Talad” program on 1 February 2024 that he expected the Thai stock market to trade narrowly, as it benefited from the better overall performance in the Asia market compared to the Wall Street since the curve of the US 10-year bond yield dropped below 4% and currently at 3.95%.
As for international factors, the US Fed held its short-term interest rate at 5.25-5.50%, while signaling that it had no plan to cut the interest rate in March, as the US inflation rate was still higher than the target. The Fed will take the PCE data for January into account at the March meeting, and if the price remains above 2.2%, the analyst noted that it will be difficult to see a rate cut in March.
However, there are some positive signs from the meeting yesterday as the Fed no longer used the tone that could convey the market of more aggressive policies. This signaled that the cycle of interest policy will be stabilized and gradually adjusted to the lower level.
In terms of domestic factors, the Bank of Thailand (BOT) signaled the possibility of downgrading the target of the country’s GDP. This raised expectations for the interest rate to go downward, with investors expecting interest rate cut policies.
The political factors had a short-term impact, as the mid- and long-term effects were something to be monitored.
For investment strategies, the analyst recommended stocks that benefited from the fall of the Thai bond yield and the strengthening baht, such as power plant stocks, including GPSC. As for the number of Chinese tourists that rose to 137,000 and could reach 140,000 throughout the year, the most prominent tourism stock is AAV. Meanwhile, MTC is a promising stock to speculate on among finance stocks.