Daily Strategy: CNS Recommends Earnings-Play, Expecting Fund Flow to Slow Down
Capital Nomura Securities saw local institutions selloff as increasing reserve, expecting fund flow to slow down near month-end.
Major stock markets in Asia traded mostly higher on Thursday after Dow Jones notched up to a record high over the night.
On October 21, 2021, Thailand’s SET Index opened at 1,644.90 points, increased 7.35 points or 0.45%.
As of 10:15 local time in Thailand, Nikkei fell 0.32%, Shanghai Composite rose 0.47%, Hang Seng Index 0.13%, Australia ASX200 gained 0.27% and Indonesia IDX Composite dipped 0.39%.
Over the night, Dow Jones rose 0.43% to close at 35,609.34 points while hitting an intraday record high on Wednesday. S&P 500 rose 0.37% while Nasdaq dipped 0.05%.
Mr. Koraphat Vorachet, Capital Nomura Securities’ strategist, through “Kaohoon Jor Talad Program” on October 21, 2021, stated that the Thai stock market could edge higher in the morning, but warned investors to be cautious at the end of today’s session due to a long holiday this week, giving a support range at 1629-1622 points and a resistance range of 1646-1651 points.
Mr. Vorachet stated that the earnings of Thai bank came out better than expected, but when looking into the statement, the profit before provision was lower than expected.
The analyst expected more pressure to be dumped into the Thai market next week as the analysis of the banking sectors will start to be reported, giving an insight to the overall outlook in 3Q that Mr. Vorachet is estimated to be weaker.
As for the selloff from Local Institutions, Mr. Vorachet warded off concerns, saying that the selloff might be due to increasing funding reserve, while expecting buying pressure from foreign investors to slow down at the end of this month.
In addition, the analyst recommended earnings play that 3Q21 outlook should be positive namely; SINGER (FV54), JMT (FV56) and TIDLOR (FV44).