• Rebound seen on easing concern over Brexit: Europe and US stock markets as well as the world’s crude oil price surged after the latest poll suggested it’s more likely Britain will stay in the European Union than leave it.
• Double track rail project to seek Cabinet’s approval: Government’s infrastructure investment projects have seen progress nicely. Collaboration project with Chinese government and the soon-to-be-approved infrastructure projects by the government are likely to help restore investor’s confidence. For today, a double track rail Mabkabao to Chira junction project worth roughly Bt30bn will be put on the table for the Cabinet’s approval.
• Positive sentiment but profit taking is likely: Institutional and foreign investors have built up their stock positions as fear over Brexit has lessened. However, there is the likelihood of profit taking if the market has extended its gains as our F-G index has approached the year’s peak level. Additionally, the SET’s valuation looks expensive trading above 15x forward P/E.
• Trading range strategy still: The SET index is likely to trade within a range of 1410-1430 points and the 1395-point level will serve as key support. Investors would look to take profit at 1440 points (equivalent to 15.5x consensus forward P/E) and prompt to stop loss if the support is broken.
• Short-term investment strategy: Any gains would offer a profit taking opportunity and then buy the pullback.
(1) Tourism recovery play: Hold onto AOT shares.
(2) Selective play: Hold onto long positions in TK, PTTGC, and short positions in THAI.
Source: poems.in.th / settrade.com
