Oil hits new 2016 highs: WTI oil prices rallied to US$47.72/barrel on Mon after oil pipeline sabotage in Nigeria fueled concerns about widening global supply deficit while Goldman Sachs said disruption to supply had seen the market flip into deficit this year. In our view, higher oil prices should lift sentiment in energy counters today.
Foreign fund inflows still insignificant: For MTD, foreign investors remained net sellers of Thai equities. Even though foreign investors bought a small amount of Thai shares on Mon, they continued to be net sellers of bonds for the third day in a row as the baht remained on the back foot against the US dollar which made Thailand less attractive to draw foreign fund inflows while Thai stocks were also generally not cheap anymore.
SETI seen in holding pattern: Overall first-quarter earnings season was not worse than previously thought while the market’s focus today may shift back to the upcoming re-auction of 4G 900MHz spectrum earlier abandoned by JASMBB as things take a turn after TRUE has pulled out of the re-auction. In our view, oil and ICT counters would act as short-term market boosters today. Support for the SET index is seen at 1390 points and resistance at 1410 points today.
Short-term strategy: It seems to us that selective trading strategy looks appropriate in current market conditions. Equity exposure should also be capped at 40%-60% of the portfolio.
(1) Tourism recovery play: Hold onto AOT shares.
(2) Earnings play: Hold onto LH shares.
(3) Selective play: Hold onto MAJOR shares and take long positions on ADVANC shares for speculative purposes on news that TRUE has pulled out of 4G 900MHz re-auction.
(1) Tourism recovery play: Hold onto AOT shares.
(2) Earnings play: Hold onto LH shares.
(3) Selective play: Hold onto MAJOR shares and take long positions on ADVANC shares for speculative purposes on news that TRUE has pulled out of 4G 900MHz re-auction.
Source: poems.in.th / settrade.com
