Brokers project neutral-to-negative outlooks for the Thai stock market on Monday, as market participants digest the recent development in the U.S. monetary policy. This situation has prompted investors to increase caution regarding risky assets.
Asia Plus Securities expects the Thai benchmark to trade sideways-down, as foreign markets were pressured by the tightening of the U.S. monetary policy.
The main pressure comes from the Federal Reserve Chairman’s speech at the Jackson Hole meeting, which reflected the view that inflation control must continue and that inflation remains too high. Consequently, the market estimates that there is still a possibility of further interest rate hikes at the Fed’s September meeting. Additionally, the increased investors caution also raised the bond yields and the US dollar.
Energy factors have also added pressure on the market following reports of resumed attacks by Iran, which pushed crude oil prices higher.
The securities firm set a resistance level for the SET Index at 1,600 points and a support level at 1,575 – 1,580 points.
Meanwhile, Daol Securities anticipates the SET Index to move sideways within a range of 1,545 + 1,620 points this week, viewing the Fed’s stance as relatively hawkish. Consequently, investors are prioritizing upcoming U.S. labor statistics and inflation data in the following week to assess the direction of the Fed’s rates policy.
In the short term, Daol believes that the market lacks new positive drivers and therefore recommends gradually accumulating stocks for medium to long-term investment.
The broker’s top picks highlighted the tourism theme, including CENTEL, ERW, and AOT, and the data center theme, including GPSC, BGRIM, and ADVANC. For the banking sector, the analyst viewed selling pressure following interim dividend announcements as an opportunity to accumulate, selecting KTB, KBANK, TTB, and KKP as outstanding stocks.
Last Friday, Thailand’s SET Index closed at 1,588.22 points, decreasing by 12.48 points or 0.78%, with a trading value of THB 66.47 billion.
