Expect the SET to trade in a tight range as investors now await Friday's US payrolls report to determine whether the Federal Reserve will hike interest rates as soon as its meeting in mid-June. OPEC failed to reach an agreement on a new output ceiling pressuring crude oil price as well as energy stocks but the pressure should be limited from a drop in US crude stock piles. Local factors today are mixed. Business sentiment inched down for second-straight month due to low season of tourism but there are positive new production-line machinery figures and Bt5bn investment plan for SEZ which are supportive.
Local issues
Business sentiment inched down for second-straight month. According to Bank of Thailand’s business sentiment index (BSI) report, business sentiment declined for the second-consecutive month to 49.7 in May, down from 49.8 in April and 51.5 in March. The sentiment in May was somewhat mixed as confidence in the manufacturing sector slightly increased, primarily owing to new domestic orders in the automobile, paper, and printing sectors while hotel and restaurant sectors showed less confidence due to the low season for tourism. (Bangkok Post)
Business sentiment inched down for second-straight month. According to Bank of Thailand’s business sentiment index (BSI) report, business sentiment declined for the second-consecutive month to 49.7 in May, down from 49.8 in April and 51.5 in March. The sentiment in May was somewhat mixed as confidence in the manufacturing sector slightly increased, primarily owing to new domestic orders in the automobile, paper, and printing sectors while hotel and restaurant sectors showed less confidence due to the low season for tourism. (Bangkok Post)
New production-line machinery up 8%. Registration of new production-line machinery in 5M16 rose to 508 owners with 3,353 machines worth a total of Bt34bn, up 8% YoY from 470 owners with 2,085 machines. The top five industries having new machines registered included metal products, plastic products, printing, non-metal products, and the businesses of polishing, grinding, and milling. (Bangkok Post)
Bt5bn to be invested for SEZ. The state plans to invest Bt5bn on building a special economic zone (SEZ) in Sa Kaeo in a bid to serve SME operators who may be interested in expanding into Cambodia, said Industry Minister Atchaka Sibunruang. Once EIA is completed in July, the ministry will seek cabinet approval and commence construction in October. (Bangkok Post)
Global issues
The ECB and OPEC meetings came ahead of monthly US payrolls data, which could solidify or dash expectations for a Fed rate hike as soon as this month. US stocks rebounded from a morning selloff to close at a seven-month high, while treasuries advanced as investors awaited Friday’s American jobs data for clues to the timing of the Federal Reserve’s next policy move. (Reuters, Bloomberg)
The ECB and OPEC meetings came ahead of monthly US payrolls data, which could solidify or dash expectations for a Fed rate hike as soon as this month. US stocks rebounded from a morning selloff to close at a seven-month high, while treasuries advanced as investors awaited Friday’s American jobs data for clues to the timing of the Federal Reserve’s next policy move. (Reuters, Bloomberg)
OPEC meeting. OPEC failed to reach an agreement for a new output ceiling at the group’s meeting in Vienna, leaving members pumping as much as they want. While members of OPEC failed to agree on a new output target, oil price fell. However, US crude stock piles dropped by 1.4mn barrels as production fell for a 12th week, reported from EIA, then oil price surged about 85 cents to near US$50.04 for Brent crude oil. (Reuters, Bloomberg)
The dollar index rose 0.1% to 95.555. The dollar rose against the euro after the ECB kept its interest rate unchanged. The euro fell 0.3% against the dollar to US$1.115. Meanwhile, the dollar fell to 108.5 yen in early trading, its lowest level since 16 May. That level was down 2.5% from a one-month high of 111.45 yen on Monday. (Reuters)
USA
Wall Street closed slightly higher on Thursday as fresh data gave a rosier view of the economy and further gains for healthcare shares countered declines in energy names. (Reuters)
Wall Street closed slightly higher on Thursday as fresh data gave a rosier view of the economy and further gains for healthcare shares countered declines in energy names. (Reuters)
Investors now await Friday's payrolls report as they evaluate economic data to determine whether the Federal Reserve will hike interest rates as soon as its 14-15 Jun meeting. (Reuters)
Jobless claims slightly below forecast. US private employers increased hiring in May and new applications for jobless benefits fell last week, further boosting the economic outlook for 2Q16. The figure was 267K compared with 270K estimate. Another report on Thursday showed planned layoffs by US-based employers fell 53% to a five-month low last month. (Reuters)
Europe
ECB kept rates and stimulus unchanged. The ECB left the main refinancing rate at zero, the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.25 percent and minus 0.40 percent respectively. As a component of its asset purchases of €80bn (US$89bn) a month, the ECB will begin buying corporate bonds on 8 Jun, according to a statement of President Mario Draghi. Based on Brexit concerns, Draghi also said Britain would benefit from staying in the European Union. (Reuters, Bloomberg)
ECB kept rates and stimulus unchanged. The ECB left the main refinancing rate at zero, the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.25 percent and minus 0.40 percent respectively. As a component of its asset purchases of €80bn (US$89bn) a month, the ECB will begin buying corporate bonds on 8 Jun, according to a statement of President Mario Draghi. Based on Brexit concerns, Draghi also said Britain would benefit from staying in the European Union. (Reuters, Bloomberg)
Asia
Japan April real wage gains slow. Japanese price-adjusted real wages in April rose 0.6 % YoY in April, less than a revised 1.6% YoY increase in March, in warning sign that upward pressure on pay rises. (Reuters)
Japan April real wage gains slow. Japanese price-adjusted real wages in April rose 0.6 % YoY in April, less than a revised 1.6% YoY increase in March, in warning sign that upward pressure on pay rises. (Reuters)
Japanese investment flows into US bonds hit multiyear highs in March, a sign Japanese policy efforts to reflate the economy out of stagnation are struggling. US Treasury data showed Japanese investors in March bought net US$11.7bn in bonds issued by US government-sponsored agencies. The net buying was the third biggest on record. US Treasury data that looks at bond transactions between U.S. and non-US residents shows Japanese investors net bought US$31.3bn of U.S. bonds in March, the most since January 2012. (Reuters)
Commodities
Slight change for gold on Thursday as the dollar turned positive after the ECB said it made only marginal upward adjustments to its inflation projections whereas investors remained cautious ahead of US labor data. Spot gold settled down 0.2% at US$1,210.49 an ounce (Reuters)
Slight change for gold on Thursday as the dollar turned positive after the ECB said it made only marginal upward adjustments to its inflation projections whereas investors remained cautious ahead of US labor data. Spot gold settled down 0.2% at US$1,210.49 an ounce (Reuters)
Oil prices inched up on Thursday, with Brent closing above US$50/barrel the first time in 7 months, after the latest drawdown in US crude stockpiles offset OPEC’s failure to set output ceiling. Brent was up 0.6% to US$50.04/barrel while crude oil went up 0.3% to US$49.17/barrel. (Reuters)
Source: aws.co.th / settrade.com
