Daily Strategy for Investors on July 18, 2019

Phillip Securities has made an analysis for the trading session on July 18, 2019, stating that the trading would be seen swinging sideways with a downward tilt amid bearish global and domestic cues.

Thai stocks look set to spend most of today’s trading session moving sideways with a downward bias as sentiment remains under pressure from a slew of negative global and domestic factors. The cocktail of slumping oil prices, weak domestic economic data and US President Donald Trump’s renewed threat in the US-China trade war seem to outweigh current positive factors, in our view. Overall trading range for the SET index is seen between 1,710 and 1,725 points today.

 

Oil prices tank on signs of easing Iran tensions and US stock build
US West Texas Intermediate (WTI) crude tumbled more than 5% since the start of the week as hopes for a return of Iranian crude to the global oil market increased amid signs of easing tensions in the Middle East after US President Donald Trump said progress had been made with Tehran and the US Energy Information Administration (EIA) data showed large builds in refined product stockpiles. US distillate stockpiles rose by 5.7mn barrels, well above expectations for a 613,000-barrel increase.

 

BOT’s pessimistic view on economy
The Bank of Thailand said the economy will grow less than previously estimated, citing weaker-than-expected exports, tourism sector and government spending while the Thai baht is on an upward trend. Even though the central bank has closely monitored the baht’s movements, the risk of Thailand being added to the US’ expanded watch list of currency manipulators also discourages aggressive intervention to curb the baht’s rise. As the country’s real interest rates are already low, policy rate cuts may not help.

 

Key Themes at Play
Bank earnings plays: BAY, KKP, SCB
New stimulus hopes: AOT, BJC, BBL, CK, GCAP, NER, SCB, STEC