Daily Strategy for Investors on July 15, 2020

Asia Wealth Securities (AWS) released an analysis for the trading session on July 15, 2020, indicating the essential events in the stock market as follows:

 

Investment Ideas:

Investment Overview Today – AWS believes that the SET Index is volatile, but today will be able to recover. Positive factors to support in the short-term is the progress on vaccine development in foreign countries, relieving concerns about the current of COVID-19 situation. Yesterday, the SET Index traded in negative territory all day, as well as regional stock markets and the European stock markets due to concerns with the situation of  COVID-19, both domestic and abroad. Thailand has found infected people in Bangkok and Rayong. However, the SET Index has recovered and reduced the negative range to close at 1,341.07 points, down 1.3 points  (-0.1%) only. Investment strategy today (15 July), AWS still focus on stocks in the group that have specific positive factors according to the theme investment.

 

The SET Index and regional stock markets are expected to return with the positive sentiment on vaccine development progress – According to Moderna, the U.S. biotechnology company, reported that the mRNA-1273 vaccine for the COVID-19 virus produced by the company is able to create strong immune responses. AWS sees this issue to reduce concerns for the COVID-19 situation that pressured the overall investment at the beginning of the week.

 

OPEC+ is expected to receive JMMC proposals to ease production cuts – An issue worth observing at the JMMC meeting of the OPEC+ tonight. The discussion is about the oil production capacity reduction agreement according to the original agreement (6 June), in which OPEC+ extended the time to reduce the production capacity of 9.7 million barrels per day to July 2020 (originally ending June 2020). Consensus estimates that OPEC + will agree to the proposal of JMMC to relax the reduction of production to 7.7 million barrels per day from August – Dec 2020, causing us to expect WTI oil prices to remain stable in the range of USD37 – 42 dollars per barrel.  

 

MRTA opens for sale of the RFP orange line project. AWS picks BEM as the most outstanding – the Mass Rapid Transit Authority of Thailand (MRTA) has opened the request for Proposal Documents (RFP) as a partner which will invest in the MRT Orange Line Project Bangkhunnon – Min Buri (Suwinthawong) during  10 – 24 July 2020, with companies interested to contact to request the purchase of investment proposals total 6 companies as follows (1) BEM, (2) BTSC, (3) BTS, (4) STEC, (5) ITD and (6) RATCH

 

The key of the U.S. economic data for this week – The Empire State Manufacturing Index for July from the New York Fed / The import and export prices in June / The industrial production in June / The economic report or Beige Book from the Federal Reserve / The number of weekly jobless claims / The retail sales in June / The manufacturing index in July from Fed Philadelphia / The housing market index in July from the National Home Builders Association (NAHB) / The business inventories reserve in May / The numbers of construction housing and construction permits in June and the initial consumer confidence in July from the University of Michigan.  

 

Technical View – Today, AWS expects the SET Index to move between 1,332 – 1,352 points. (Support at 1,337 1,332 and 1,322 points and resistance at 1,346 1,352 and 1,362 points). The recommended stocks are SCC, KCE, RS, EA and TOA   

 

Theme Investment

1)The stock which obtains the benefit from economic stimulus measures, the economic stimulus measure in the 1st phase – CPALL, HMPRO, BJC, OSP, CBG, TTW and MTC, the tourist stimulus measures – AOT, AAV, ERW and MINT, the government budgeting measures – CK, BEM, STEC, SEAFCO, PYLON and TASCO

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

3)Dividend Play – KKP, TISCO, QH, LH, ORI, NOBLE, DIF, INTUCH, HANA, EASTW, TTW, EGCO and RATCH

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