Daily Strategy for Investors on April 24, 2020

Asia Wealth Securities (AWS) released an analysis for the trading session on April 24, 2020, indicating the essential events in the stock market as follows:

 

Investment Ideas:

– Investment overview – AWS expects the SET to fluctuate, not strong. It needs to be careful with profit taking during the day. The increase in crude oil prices is caused by short-term fluctuations, especially the boundary between the oil contract for May and June delivery. Fundamentals remain weak. The interesting issues and the new theme investment today; AWS looks at AOT and BAFS might benefit the most from the resumption of domestic airlines.

 

1) The increase in crude oil prices is considered as short-term speculation in the oil group. The increase in crude oil prices, AWS looks at only short-term factors from concerns over the situation in the Persian Gulf. AWS believes that there is less possibility for war occurrence, while AWS remains pessimistic about the fundamentals of crude oil prices.

2) US economic data came out as expected, but it is still weak – the number of Americans applying for unemployment benefits for the first time has risen to 4.4 million people, close to market expectations. Even though the numbers decreased from the previous week, it was still considered as a high level of statistics.

3) Interesting foreign economic issues of the week, follow the Bank of Japan (BOJ) meeting which the market expects to see an increase in QE limit or may do QE without limit after the COVID-19  situation worsened.

4) The airline is ready to return to service on 1 May. From this point, AWS believes that the airline will not benefit much, but AOT and BAFS have more benefits (new investment theme). Although AOT has announced additional aid measures, AWS estimates that it will only affect the valuation of only Bt 1.0 0 (the AOT target price is Bt 70.00 ), while AWS expects the 3Q20  earnings outlook (Apr-Jun) will be net loss which AWS included in the 2020  earnings forecast (Oct 19 – Sep 20).

 

– Technical view – AWS expects the SET Index to move today in a range of 1,264 – 1,294 points (with support at 1,270 1 ,264 and 1,255 points and with resistance at 1,278 1 ,285 and 1,294 points) with technical stocks recommended including CPALL, PTTGC, HMPRO, THANI and WHA .