Daily Strategy for Investors on April 10, 2020

Asia Wealth Securities (AWS) released an analysis for the trading session on April 10, 2020, indicating the essential events in the stock market as follows:

 

Investment Ideas:

Investment overview today – AWS still sees  the volatile on Thai stock market, but AWS believes that it is still a short-term upward trend, driven by domestic and international stimulus measures, especially the Fed that announcing a new round of stimulus measures in the amount of USD2.3tn for business groups, including employee income insurance programs and other measures. However, it still has to be careful about selling shares in the energy sector after the OPEC+ meeting, there is nothing surprising. It needs to follow the attitude of the G20 group to see how much cooperation. AWS recommends investing in stocks that have a specific positive factors in accordance with AWS theme investment.

Technical view – AWS expects the SET index to move in a range of 1,178 – 1,235 points (with support at 1,194, 1,178 and 1,153 points and resistance levels at 1,218 1,235 and 1,259 points). Recommended stocks today are as follows: BDMS, RS, BANPU, KCE, and PTG (Follow in the Technical Express report).

 

1) Crude oil market – Crude oil prices are very volatile after the OPEC+ meeting resolved to reduce the production capacity, which is not more than the market expected. Specifically, it was reduced from the production capacity of the two main countries (Saudi Arabia and Russia) that have increased their production capacity previously. When compared to the period before the reduction of production capacity, it is equal to both countries, reducing the production capacity by only 1 – 1.5 million barrels per day only.

2) There are US economic stimulus measures continually – The Fed announced an economic stimulus package of USD2.3tn which is a project to grant loans to businesses in the amount of USD650bn. Moreover, there are employee income insurance programs and other measures to heal the business sector affected by COVID-19 after the US Department of Labor revealed that the number of Americans applying for unemployment benefits for the first time increased to 6.6 million last week.  

3) The COVID-19 situation in foreign countries – The number of people infected continues to increase at a constant rate while in Thailand, the number of new infected people began to increase at a reduced rate. Throughout the week, the number of new infections increased to less than 100 people per day.

 

Economic data – Today, it still has to follow: The US core CPI report for March 2020 is expected to be at 0.1%MoM, while next week, there will be 1Q20 China’s GDP.  

 

Theme Investment: 

1) Slightly affected stocks from COVID-19, AWS chooses TU, GFPT, CPF, TFG, BJC, CPALL, and TQM. 

2) Down side limiting and strong cash flow, AWS chooses BGRIM, EGCO, GULF, GPSC, and RATCH. 

3) Stocks which obtained the benefit from work from home measure, AWS chooses ADVANC, INTUCH, DTAC, TRUE, DIF, and COM7. 

4) Stocks for long term investment (DCA), AWS chooses ADVANC, AOT, BDMS, and DIF. 

5) Economic stimulus measures and the accelerated disbursement of the government budget for the year 2020, AWS chooses CK, SEAFCO, WHA, KKP, AOT, CPALL, BEM, and HMPRO.

6) Defensive and high dividend, AWS chooses KKP (Div.Yld. 15.9%) QH (Div.Yld. 9.3%) DIF*(Div.Yld 8.2%) TISCO (Div.Yld. 8.7%) INTUCH*(Div.Yld. 6.2%) TTW*(Div.Yld. 4.8%) and RATCH*(Div.Yld. 4.2%) *IAA Consensus