Yesterday's market: The SET saw higher pressure late last week, causing it to fall more sharply. We believe that the loss is attributed partly to pressure from a fall in international equity markets and a decline in global crude.
Today's outlook: We expect the SET the continue to decline because investment sentiment in foreign markets is not bright this morning after both U.S. and European equity markets turned to fall following a decline in global crude to below US$50 a barrel, pressured by a gain in U.S. oil rigs last week. What's more, investors were concerned about a U.K. referendum on June 23 to determine if the Kingdom will leave the EU or not.
Strategy: Given that, FSS believes the SET will continue to retreat to reduce the heat after the index has increased too quickly in the last two weeks. However, liquidity remains abundant. In addition, we expect investor confidence about a slower rate hike to remain intact. Hence, there is likely buyback momentum which will support the market. In particular, we expect the SET to rally to our index target of 1500. For this reason, we recommend that investors buy on weakness and then hold.
Support 1426-1420 , 1416-1410
Resistance 1432-1436 , 1438-1442
Source: fnsyrus.com / settrade.com
