Expect SET to trade in a tight range today as investors may need time to digest a series of crucial data from the major economies and Thailand’s 1Q16 GDP data to be released at 9:30am today. Even on Wall Street, investors had a negative reaction on Friday to the upbeat crucial retail and household sentiment reports but the Fed Fund futures and Treasury market priced in less than a 5% chance of a Fed hike in June. Weak Chinese data on the weekend may overshadow decent euro zone GDP data. On the local front, the main focus is today’s GDP data from the NESDB and 1Q16 market earnings results from the SET tomorrow or next day.
Local issue
Finance Minister Apisak Tantivorawong expects at least 3% growth this year though BoT saw increasing downside risks to growth. His expectation was relying on economic readings, including improved imports of capital goods and government’s massive investment in infrastructure investments. (Bangkok Post)
Finance Minister Apisak Tantivorawong expects at least 3% growth this year though BoT saw increasing downside risks to growth. His expectation was relying on economic readings, including improved imports of capital goods and government’s massive investment in infrastructure investments. (Bangkok Post)
Rail project cost nears agreement. Transport Minister Arkhom Termpittayapaisith believes after the latest meeting between Thai and Chinese officials in Beijing that a disagreement between the two countries over the Bangkok-Nakhon Ratchasima high-speed rail project should be resolved in a week, which China is considering reducing the cost estimates for some jobs in the project. Further there was an agreement to speed up the railway construction by dividing the construction work into several sections, which do not need to wait for the whole project to be completely designed. (Bangkok Post)
FTA with Pakistan close to happen. The Trade Negotiations Department, after negotiating for the third round last week, expects Thailand and Pakistan to wrap up the bilateral free-trade agreement negotiations by the end of this year and the pact could be effectively implemented next year. (The Nation)
Banks’ bad loans increased in 1Q16. Commercial banks’ non-performing loans (NPLs) rose to 2.64% in 1Q16, up from 2.55% in 4Q15, said Don Nakornthab, a senior director of the financial institutions strategy department. He further added that NPLs and special-mention loans in SMEs remain a concern given its upward trend. (Bangkok Post)
Global issues
Latest data point to stronger US economic outlook and decent growth in euro zone but doubt over Chinese economy: Strong US retail sales and consumer sentiment data buoy the US economic outlook. Eurostat, though revising down its earlier estimate, reported decent euro zone economic growth in 1Q16. However, China's investment, factory output and retail sales all grew more slowly than expected in April, adding to doubts about whether the world's second-largest economy is stabilising. (Reuters)
Latest data point to stronger US economic outlook and decent growth in euro zone but doubt over Chinese economy: Strong US retail sales and consumer sentiment data buoy the US economic outlook. Eurostat, though revising down its earlier estimate, reported decent euro zone economic growth in 1Q16. However, China's investment, factory output and retail sales all grew more slowly than expected in April, adding to doubts about whether the world's second-largest economy is stabilising. (Reuters)
Surprising reaction to the strong US data in the Fed Fund futures and Treasury market, as Fed Fund futures virtually ignored the stronger US data and priced in less than a 5% chance of a 0.25% Fed hike at the June meeting - while the 10-year US Treasury yield fell 5 basis points to 1.70% (lowest close in five weeks).
The dollar climbed to a two-week peak against a basket of currencies on Friday, as stronger-than-expected US economic data appeared to boost expectations the Federal Reserve may raise interest rates more than once this year. The euro meanwhile fell to US$1.1304, down 0.6%. (Reuters)
USA
Wall Street shares fell on Friday as a decline in oil prices added to pressure from consumer companies after gloomy quarterly reports from Nordstrom and JC Penney overshadowed upbeat April retail sales data. The decline in the department stores' shares highlighted the expanding clout of Amazon.com and the plight of brick-and mortar retailers struggling to keep up with the online seller. (Reuters)
Wall Street shares fell on Friday as a decline in oil prices added to pressure from consumer companies after gloomy quarterly reports from Nordstrom and JC Penney overshadowed upbeat April retail sales data. The decline in the department stores' shares highlighted the expanding clout of Amazon.com and the plight of brick-and mortar retailers struggling to keep up with the online seller. (Reuters)
1Q16 earnings are not bad: 1Q16 earnings reports are nearly all in and on average have not been quite as bad as expected across the S&P500. But for 2Q16 earnings, for every company that has given an upbeat preannouncement, 2.3 others have sounded warnings. That has left the S&P500 trading at about 16.5 times expected earnings, according to Thomson Reuters I/B/E/S. (Reuters)
US retail sales in April recorded their biggest increase in a year as Americans stepped up purchases of automobiles and a range of other goods, suggesting the economy was regaining momentum after growth almost stalled in 1Q16. Retail sales surged 1.3% MoM last month, the largest gain since March 2015, after dropping 0.3% in March. Excluding automobiles, gasoline, building materials and food services, retail sales shot up 0.9% last month after an upwardly revised 0.2% gain in March. Economists had forecast retail sales rising 0.8%. (Reuters)
Sentiment among US households jumped to an 11-month high in early May. The University of Michigan said its consumer sentiment index surged 6.8 points to 95.8 early this month, the highest reading since June. Sentiment increased among all income and age groups, with big gains among lower-income and younger households. (Reuters)
Producer price index climbed 0.2% in April after slipping 0.1% in March. In the 12 months through April, the PPI was unchanged after dipping 0.1% in March. (Reuters)
Business inventories increased 0.4% in March, suggesting that growth was much higher than initially estimated. (Reuters)
Europe
European shares finished higher on Friday as strong US retail sales data buoyed markets, although satellite company Eutelsat plunged nearly 30% after slashing its outlook. (Reuters)
European shares finished higher on Friday as strong US retail sales data buoyed markets, although satellite company Eutelsat plunged nearly 30% after slashing its outlook. (Reuters)
The euro zone GDP grew by 0.5% QoQ and 1.5% YoY in 1Q16, a downward revision of an earlier estimate. Eurostat on April 29 reported euro zone’s fastest rate of expansion for five years, with quarterly growth of 0.6% and a YoY figure of 1.6%. Of the euro zone's larger economies, German GDP increased by 0.7%, French GDP by 0.5%, in Italy by 0.3% and in Spain by 0.8%. (Reuters)
Asia
Japan steps up yen intervention rhetoric: Expectations are growing that Japanese authorities may intervene in the currency market after they explicitly warned they would do so, worried that the yen's rise to its highest levels in a year and a half will threaten the already sluggish economy. (Reuters)
Japan steps up yen intervention rhetoric: Expectations are growing that Japanese authorities may intervene in the currency market after they explicitly warned they would do so, worried that the yen's rise to its highest levels in a year and a half will threaten the already sluggish economy. (Reuters)
Japanese PM Shinzo Abe has decided to delay a sales tax hike set for next April, the Nikkei reported on Friday. Abe is expected to announce the delay after further consideration, including talks with fellow Group of Seven leaders at a summit in Japan, the paper reported. (Reuters)
Growth in China’s factory output cooled to 6% in April, the National Bureau of Statistics (NBS) said on Saturday, disappointing analysts who expected it to rise to 6.5% on an annual basis after an increase of 6.8% the prior month. (Reuters)
China's fixed-asset investment growth eased to 10.5% YoY in the January-April period, missing market expectations of 10.9%, and down from the first quarter's 10.7%. (Reuters)
China’s retail sales growth in April slowed to 10.1% from a 10.5% gain in March. The data capture both private and government purchasing. Analysts forecast sales would rise 10.5% YoY. (Reuters)
Commodities
Oil slipped on Friday on a stronger dollar and as investors cashed in on a three-day rally, but prices still ended the week higher after production in Nigeria fell to its lowest in two decades and wildfires slashed output from Canada's oil sands. Brent crude futures settled down 25 cents (-0.5%) at US$47.83 a barrel while US crude ended 49 cents lower (-1.1%) at US$46.21. (Reuters)
Oil slipped on Friday on a stronger dollar and as investors cashed in on a three-day rally, but prices still ended the week higher after production in Nigeria fell to its lowest in two decades and wildfires slashed output from Canada's oil sands. Brent crude futures settled down 25 cents (-0.5%) at US$47.83 a barrel while US crude ended 49 cents lower (-1.1%) at US$46.21. (Reuters)
Copper bounced back from a 2-1/2 month low on Friday as optimism over a rebound in US economic growth overshadowed a stronger dollar and the prospect of higher US interest rates. London Metal Exchange three-month copper was bid up 0.3% at US$4,627.50 a tonne, bouncing from a low of US$4,594, its weakest since Feb. 25. (Reuters)
Gold prices rose on Friday, buoyed by weak US equity markets and chart-based strength, as it shrugged off a higher dollar and strong US economic data suggesting a brightening outlook for the economy. Spot gold was up 0.8% at US$1,273.53 an ounce. That left gold down 1.1% last week, the biggest weekly decline since the week ended March 25. (Reuters)
Source: aws.co.th / settrade.com
