Thai shares are poised to trade higher today trailing most global bourses bolstered by solid US and Europe corporate earnings with energy shares likely to benefit from a rebound in oil prices. A drop in the yen, even though it was partly because of a new pledge by Tokyo that it was prepared to weaken the currency, indicates improved global risk appetite. Locally, strong improvement in SMEs’ sentiment is very crucial and positive. It also indicates that the government has been on the right track as far as economic stimulus is concerned.
Local issue
Positive sentiment on SMEs in March. According to the Office of Small and Medium Enterprises Promotion (OSMEP), the Small and Medium Enterprise Trade and Service Sentiment Index (TSSI) rose to 100.4 in Mar, rebounding from 92.6 in Feb. The improved performance of the trading and service sector was primarily attributed to government’s stimulus measures. (Bangkok Post)
Positive sentiment on SMEs in March. According to the Office of Small and Medium Enterprises Promotion (OSMEP), the Small and Medium Enterprise Trade and Service Sentiment Index (TSSI) rose to 100.4 in Mar, rebounding from 92.6 in Feb. The improved performance of the trading and service sector was primarily attributed to government’s stimulus measures. (Bangkok Post)
Steel prices to be inspected. Director-general of the Internal Trade Department Wiboonlasana Ruamraksa said, the department has been inspecting steel prices at retail and wholesale outlets in order to prevent hoarding and profiteering while the state is speeding up infrastructure investments. The rise of such prices was partly due to the closure of substandard steel factories in China and China’s policy to cut steel production, leading to lower supply. (Bangkok Post)
Global issues
The yen stayed on the defensive on Tuesday, following two sessions of steep declines after Japanese officials stepped up their warning about intervening to weaken the currency. The dollar climbed as far as ¥109.38, pulling further away from an 18-month trough of ¥105.55 set last week. The euro traded at ¥124.21, having bounced off a three-year trough of ¥121.48 plumbed on Friday. (Reuters)
The yen stayed on the defensive on Tuesday, following two sessions of steep declines after Japanese officials stepped up their warning about intervening to weaken the currency. The dollar climbed as far as ¥109.38, pulling further away from an 18-month trough of ¥105.55 set last week. The euro traded at ¥124.21, having bounced off a three-year trough of ¥121.48 plumbed on Friday. (Reuters)
China's foreign ministry expressed anger on Tuesday after a US navy warship carried out a freedom of navigation operation near a disputed reef in the South China Seas. It stated the ship illegally entered the waters without China's permission and that the move threatened peace and stability. (Reuters)
USA
Wall Street shares rose across the board on Tuesday, with a jump in oil prices and a rally in Amazon.com, helping propel the S&P500 to its best day in two months. The market was also buoyed by higher global stock markets due to solid corporate earnings in Europe, progress on Greek debt talks, and a new pledge by Japan that it was prepared to weaken the yen. (Reuters)
Wall Street shares rose across the board on Tuesday, with a jump in oil prices and a rally in Amazon.com, helping propel the S&P500 to its best day in two months. The market was also buoyed by higher global stock markets due to solid corporate earnings in Europe, progress on Greek debt talks, and a new pledge by Japan that it was prepared to weaken the yen. (Reuters)
Investors have become more optimistic about US corporate earnings with 1Q16 earnings reports almost all in and not quite as bad as expected, The proportion of companies that have raised their forecasts versus those that lowered forecasts is the healthiest it has been since 2011, according to Thomson Reuters data. (Reuters)
Robust labor market: US job openings increased in March to the highest level in eight months and layoffs continued to decline. Job openings rose 149,000 to a seasonally adjusted 5.8mn, according to the Job Openings and Labor Turnover Survey (JOLTS) report. That was the highest reading since July. The gain lifted the jobs openings rate to 3.9%. The JOLTS report showed a further decline in layoffs, as 2.98mn Americans quit their jobs voluntarily in March, a sign of confidence in the labor market. The quit rate was unchanged at 2.1%. (Reuters)
US wholesale inventories barely rose in March as sales recorded their largest increase in nearly a year. Wholesale inventories edged up 0.1%. February inventories were revised down to show a 0.6% decrease instead of the previously reported 0.5% decline. March's increase in wholesale inventories was in line with expectations. Sales jumped 0.7% in March, the largest increase since April last year, after slipping 0.2% in February. (Reuters)
The US economy is on track to grow by a 2.2% annualized rate in 2Q16 following data that showed stronger consumer spending and fixed investments, according to the Atlanta Federal Reserve. Its latest GDP estimate was faster than the 1.7% pace reported on May 4. (Reuters)
Europe
European shares advanced on Tuesday, on solid corporate earnings reports. Leading their way were Danish jewellery maker Pandora which surged after strong results and bank Credit Suisse gained after a smaller than expected 1Q16 loss. Greek shares outperformed broader market after euro zone finance ministers offered to grant Greece some debt relief. (Reuters)
European shares advanced on Tuesday, on solid corporate earnings reports. Leading their way were Danish jewellery maker Pandora which surged after strong results and bank Credit Suisse gained after a smaller than expected 1Q16 loss. Greek shares outperformed broader market after euro zone finance ministers offered to grant Greece some debt relief. (Reuters)
ECB asks large eurozone banks to detail Brexit contingency plans, including how to deal with market shocks, business model changes, etc. ECB supervises 129 euro zone banks it deems most systemically important. ECB have warned the Brexit would hurt London's financial centre. England will have a referendum on exiting from EU membership on 23 Jun, 2016. (Reuters)
Solid corporate earnings: The first quarter earnings season is entering into its last phase. According to Thomson Reuters StarMine, nearly 70% European companies have announced results so far, of which 60% have met or beaten analysts' forecasts. (Reuters)
Asia
Japan will intervene in foreign exchange markets if the yen strengthens to ¥90-95 per dollar, even if that upsets the US, a key economic adviser to PM Shinzo Abe said on Tuesday, asserting the right to curb currency volatility. Japanese authorities last intervened in currency markets in 2011, when they sold yen for dollars. (Reuters)
Japan will intervene in foreign exchange markets if the yen strengthens to ¥90-95 per dollar, even if that upsets the US, a key economic adviser to PM Shinzo Abe said on Tuesday, asserting the right to curb currency volatility. Japanese authorities last intervened in currency markets in 2011, when they sold yen for dollars. (Reuters)
Japan’s extra US$7.15bn quake reconstruction budget: The Japanese government is set this week to compile an extra budget worth around ¥778bn (US$7.15bn) for reconstruction in the areas of southern Japan hit by deadly earthquakes last month. The quakes on the southern island of Kyushu killed about 50 people and damaged at least 5,000 homes. (Reuters)
China's consumer prices rose slightly less than expected in April, while a 4-year slump in producer prices continued to show signs of moderating, easing strains on companies facing sluggish demand and high debt levels. The CPI rose 2.3% YoY in April, unchanged from March, though prices fell 0.2% MoM. (Reuters)
Commodities
Oil prices jumped on Tuesday after a late burst of buying driven in part by expectations that record US crude inventories would not swell by as much as they have in recent weeks. Brent spiked just before settlement and settled up US$1.89 (+4.3%) at US$45.52 per barrel. US crude futures rose US$1.22 (+2.8%) to settle at US$44.66. (Reuters)
Oil prices jumped on Tuesday after a late burst of buying driven in part by expectations that record US crude inventories would not swell by as much as they have in recent weeks. Brent spiked just before settlement and settled up US$1.89 (+4.3%) at US$45.52 per barrel. US crude futures rose US$1.22 (+2.8%) to settle at US$44.66. (Reuters)
Gold fell to a near two-week low on Tuesday, after its steepest loss since March in the prior session, as a firm dollar and higher equities curbed appetite for the precious metal. Spot gold was up 0.3% at US$1,267.30 an ounce after hitting an early low of US$1,257.25, its weakest since April 28. US gold for June delivery settled down 0.1% at US$1,264.80 an ounce. (Reuters)
Source: aws.co.th / settrade.com
