Daily Strategy for Investors on January 8, 2021

Asia Wealth Securities (AWS) released an analysis for the trading session on January 8, 2021 indicating the essential events in the stock market as follows: 

 

Investment Ideas:

Today’s investment overview – AWS expects the SET today (8 Jan) to move in the range of 1,490-1,532 points. Congress endorsed Biden’s victory. Moreover, Democrats can hold absolute power in both the White House and Congress. 

This makes the market expected to see a smooth stimulus package, including the price of crude oil continues to increase which is still positive for energy stocks. The factors that will cause the stock market to fluctuate during the day are the COVID-19 situation in the country that still needs to be monitored closely. 

For investment strategy, AWS recommends selling and taking profit at full value or exceed the fundamental value while investing in the new round, AWS also recommends investing in a speculative manner by focusing on stocks with specific positive factors, for example upstream and refinery stocks, expected strong 4Q20 earnings stocks and Green Energy.

 

Congress endorsed Biden’s victory. The Democrats were able to win the second round of senators in Georgia. This allows Democrats to dominate both the White House and Congress as AWS expected, which will be a positive factor in the release of a new round of stimulus measures to mitigate the effects of COVID-19. 

That positive factor alleviates fears of the turmoil raised by Trump supporters into the Parliament. It is a positive factor that makes 3 important markets in the U.S. continue to increase and make new highs and AWS believes this will be a positive factor for the regional stock markets, including the SET Index.

 

WTI and Brent crude oil prices continue to increase which part of it was also a positive response to the U.S. Government Energy Information Administration (EIA) reported that an 80 mn barrel drop in the U.S. crude reserves last week (Ended 1 Jan) which is the fourth consecutive week of decline, in line with the American Petroleum Institute (API) reporting a 1.7mn barrel drop in the U.S. crude reserves. 

Also, the price of crude oil is also a positive factor from the Saudi Arabia which cut production by 1.0mn bpd to 8.125mn bpd. (Starting 1 Feb until the end of Mar) during the lockdown measure to prevent the spread of COVID-19 which affects the oil demand.

 

Core Investment

1) Global Play (Trading within 1 month) – PTT, SCC, PTTEP, TOP, PTTGC, IVL, CPF and TU

2) Stocks which expected that the performance in 4Q20 will outstand (1-2 months)- SAWAD, GULF, SPALI, ORI, WHA and STA

3) Green energy stocks (Trading within 3-6 months)- GPSC, EGCO, GULD, BGRIM, BPP, BCPG, EA and ACE

4) Dividend Play (Middle-term trading 6-12 months) – SC, LH, QH, KKP, TISCO, RATCH, DIF, INTUCH, EASTW and TTW

5) Long term accumulative stocks (DCA) (Long-term trading over 1 year) – AOT, BEM, ADVANC, WHA, LH, CPALL, CPF, BDMS, HMPRO, BBL and KTB