Thai shares look set to trade in a narrow range today following a lackluster performance on Wall Street overnight and investors are expected to adopt a cautious stance prior to the US non-farm payrolls report due later today. While the European economy is likely to be adversely affected by the Brexit, the US economy is the hope for the global economy. Locally, Deputy Prime Minister Somkid Jatusripitak gave a positive view over the country’s economic outlook in 2Q16 and going forward and over Asia as a whole with the potential fallout of Europe from the Brexit despite big uncertainty ahead.
Local issue
Somkid optimism on economy. Deputy Prime Minister Somkid Jatusripitak expects Thailand’s economy to grow by not less than 3% in the second quarter after estimating various economic data in the period. He further takes an optimistic view on the economic outlook going forward supported by improving MPI data and business confidence data along with the bullish tone of the tourism industry this year and next. He also update that Thailand’s Infrastructure Fund worth about Bt100bn under PPP scheme is expected to be put before the Cabinet within the next two weeks. (Bangkok Post/The Nation)
Somkid optimism on economy. Deputy Prime Minister Somkid Jatusripitak expects Thailand’s economy to grow by not less than 3% in the second quarter after estimating various economic data in the period. He further takes an optimistic view on the economic outlook going forward supported by improving MPI data and business confidence data along with the bullish tone of the tourism industry this year and next. He also update that Thailand’s Infrastructure Fund worth about Bt100bn under PPP scheme is expected to be put before the Cabinet within the next two weeks. (Bangkok Post/The Nation)
Consumer confidence dropped to 25-month low. University of the Thai Chamber of Commerce (UTCC) reported yesterday that the consumer confidence index had plummeted to 71.6 in June from 72.6 in May, hitting a 25-month low. The decline was attributed to slower-than-expected economic recovery, weak exports, the possible adverse impact from Brexit, as well as a rising unemployment rate. (Bangkok Post)
Global issues
US Treasury yields stabilized on Thursday. US 30-year Treasury yields dipped slightly while other maturities were little changed on Thursday on nervousness ahead of Friday's US non-farm payrolls report for June. US 30-year Treasuries were last up 10/32 in price to yield 2.138%. Benchmark 10-year Treasuries were last unchanged in price to yield 1.385%. (Reuters)
The yen posted strong gains for a third straight session on Thursday, while sterling fell yet again, retreating from early gains as risk appetite crumbled in afternoon trading with the decline in major US stock indexes and commodity prices. In late trading, sterling slipped 0.1% against the dollar at US$1.2919, having skidded to a 31-year low of US$1.2798 on Wednesday. It has been down more than 14% since the Brexit vote. The dollar was 0.5% lower against the yen at ¥100.78, holding above its trough of ¥99.00 hit on 24 Jun, the day after the UK vote. The euro, meanwhile, fell 0.8% against the yen to ¥111.56. (Reuters)
USA
Wall Street closed mixed on Thursday. While a tumble in oil prices weighed the DJIA and S&P500 to finish lower on the day, a report of upbeat June sales from Costco boosted the tech sector and pushed the Nasdaq to close in positive territory. Better-than-expected private hiring data for June from the ADP also gave the market support ahead of the non-farm payrolls report due later today. (Reuters)
Wall Street closed mixed on Thursday. While a tumble in oil prices weighed the DJIA and S&P500 to finish lower on the day, a report of upbeat June sales from Costco boosted the tech sector and pushed the Nasdaq to close in positive territory. Better-than-expected private hiring data for June from the ADP also gave the market support ahead of the non-farm payrolls report due later today. (Reuters)
US private employers hired 172,000 workers in June, higher than economists' expectations. Economists had forecast the ADP National Employment Report would show a gain of 159,000 jobs. Private payroll gains in the month earlier were revised to 168,000 from an originally reported 173,000 increase. (Reuters)
Economists polled by Reuters are expecting the total non-farm employment to have gained by 175,000 for June. The unemployment rate is forecast to tick up to 4.8% from 4.7% recorded a month earlier. (Reuters)
Europe
European shares rose on Thursday after a three-day losing streak, buoyed by gains in major consumer goods stocks such as Associated British Foods and Danone. However, several traders and investors said the uncertainty created by Brexit would continue to weigh on European markets. (Reuters)
Asia
Japan's current account surplus narrowed slightly in May from April as a strong yen curbed gains from investment overseas, while travel income hit a record surplus due to a rise in foreign tourists. The current account surplus stood at ¥1.81tn (US$17.96bn), down from ¥1.88tn in April. It was the 23rd straight month of surplus. Economists had forecast a surplus of ¥1.75tn. (Reuters)
Japan's current account surplus narrowed slightly in May from April as a strong yen curbed gains from investment overseas, while travel income hit a record surplus due to a rise in foreign tourists. The current account surplus stood at ¥1.81tn (US$17.96bn), down from ¥1.88tn in April. It was the 23rd straight month of surplus. Economists had forecast a surplus of ¥1.75tn. (Reuters)
Senior Japanese policymakers will discuss global market developments on Friday. The meetings underscore the concerns the government has about potential damage triggered by the Brexit vote that could inflict on Japan's fragile economic recovery. Crucial agenda will include on how the government should respond to the yen's appreciation. (Reuters)
Taiwan and China began battening down the hatches on Thursday ahead of the arrival of super Typhoon Nepartak, the first of the year, with fears in China that the storm could worsen already severe flooding in the east of the country. The typhoon has been labelled a category 5 storm on a scale of 1 to 5 by Tropical Storm Risk making it a super typhoon. (Reuters)
China reported a surprise increase in June foreign exchange reserves on Thursday. China's foreign exchange reserves rose US$20bn in June to US$3.21tn, recovering from a five-year low in May. June's increase was the biggest in 14 months. Economists had predicted reserves would fall US$20bn to US$3.17tn. However, analysts said they could fall again in coming months if the weakening yuan triggers more capital outflows. (Reuters)
Commodities
Oil prices fell 5% to two-month lows on Thursday after the US EIA reported a weekly crude draw within analysts' forecasts that disappointed market bulls expecting larger declines. Brent crude futures settled down US$2.40 (-4.9%) at US$46.40 per barrel. That was the biggest percentage loss for Brent in a day since 9 Feb. US crude futures settled down US$2.29 (-4.8%) at US$45.14. (Reuters)
Oil prices fell 5% to two-month lows on Thursday after the US EIA reported a weekly crude draw within analysts' forecasts that disappointed market bulls expecting larger declines. Brent crude futures settled down US$2.40 (-4.9%) at US$46.40 per barrel. That was the biggest percentage loss for Brent in a day since 9 Feb. US crude futures settled down US$2.29 (-4.8%) at US$45.14. (Reuters)
US crude draw below expectations: The US EIA said US crude stockpiles fell 2.2mn barrels last week, just below a 2.3mn barrel decline forecast by a Reuters poll. While the EIA reported a seventh weekly decline in crude stocks, the figure was far less than a 6.7mn barrel draw cited by trade group the American Petroleum Institute in preliminary data issued late Wednesday. (Reuters)
Gold slips as US jobs data supports the dollar, ending a six-day rally that pushed the precious metal to more than a two-year high on concerns about Brexit. Spot gold was off 0.2% at US$1,360.26 an ounce, down from Wednesday's peak of US$1,374.91, the highest since March 2014. (Reuters)
Source: aws.co.th / settrade.com
