Daily Strategy for Investors on May 11, 2020

Asia Wealth Securities (AWS) released an analysis for the trading session on May 11, 2020, indicating the essential events in the stock market as follows:

 

Investment Ideas:

Investment overview – The SET is likely to continue to recover after last week, the SET dropped by 2.7% from the end of April. Risks from limited valuation began to decline so AWS believes that the SET might return with a positive sentiment from trade negotiations with positive signs from a continuously coordinated working, recovering crude oil prices, and the number of people infected with COVID-19 that still has no negative signs after the government began to relax lockdown measures. AWS looks positively to stocks in the consumer sector, food and beverage sector, service sectors such as media and commerce sector, energy groups especially electricity producers and refinery groups, which benefit from the recovery of demand and the use of oil in the country.

 

This week also has to follow up (1) The latest trade negotiations between the US and China that post positive signs after the working team has progressed negotiations. (2) The number of people infected with COVID-19 after many countries began to ease lockdown measures, especially in Thailand. (3) Investment adjustment of MSCI which is expected to announce 12 May (effective 13 May) and (4) reporting the performance of listed companies, being the last week. Today (11 May), PTT will announce its 1Q20 financial statement. AWS expects the company to have a net loss of Bt1.5-2.0bn.  

 

The result of easing city lockdown measures towards the energy group, AWS has a positive view for the domestic refinery group, especially the increased demand for gasoline so that AWS believes that SPRC as the most profitable stock, and also recommend investing in stocks that have benefited from recovering crude oil prices in accordance with the theme investment.

 

AWS has adjusted the theme investment portfolio by offering (1) stocks that have benefited from recovering crude oil prices – PTTEP, PTT, TOP, BCP, SPRC and PTTGC, and (2) stocks that benefit from seasonal factors, AWS chooses BCPG, BGRIM, CKP GPSC and EASTW to replace the stock in limited downside and strong cash flow themes, and AWS recommends take profit the stocks that benefit from the return of domestic airlines after the previous positive share price.  

 

Technical view – AWS estimates the SET frame this week (11-15 May) at 1,250 – 1,305 points. AWS expects the SET index to move today in a range of 1,259 – 1,278 points (with support at 1,265 1,259 and 1,251 points and resistance at 1,272, 1,278 and 1,285 points). The recommended stocks today are KTC, BEM, PTTGC, STA, and PTT. (Please follow details in Technical Express)

 

Theme Investment

1) Recovery of crude oil price – PTTEP, PTT, TOP, BCP, SPRC and PTTGC

2) Stocks that benefit from entering rainy season – BCPG, BGRIM, CKP, GPSC, and EASTW

3) Stocks that benefit from government measures – ADVANC, BTS, BEM, CPF, CPALL, BJC, CRC, CPN, PLANB, HMPRO, OSP and CBG

4) Long-term cumulative shares (DCA) – ADVANC, AOT, BDMS, BEM and DIF  

5) SSFx target stocks – PTT, PTTEP, BJC, CPALL, AOT, GULF, EGCO, INTUCH, ADVANC, BAM and BDMS