Daily Strategy for Investors on February 4, 2021

Asia Wealth Securities (AWS) released an analysis for the trading session on February 4, 2021 indicating the essential events in the stock market as follows: 

 

Investment Ideas:

Today’s investment overview – AWS expected the SET today (4 Feb) to move in the range of 1,459-1,500 points. The SET Index is still volatile after foreign investors have net sales for 9 consecutive days, in 2021YTD, foreign investors have total net sales of Bt18bn. 

Positive factors that support the market at this time are the energy stocks and banking sector with individual positive factors, but still need to monitor the progress of the USD1.9tn stimulus package still receiving opposition from the council of Congress. 

AWS still has the same investment strategy by introducing to take profit on stocks that are at full value or exceeding fundamental value, focus on unique positive stocks, banking and energy stocks, and AWS Core Investment, especially expected strong 4Q20 results stocks.

 

The Monetary Policy Committee (MPC) meeting results unanimously approved to maintain the policy rate at 0.50% per year to support the economic recovery that is still highly uncertain. 

AWS remained positive for the banking sector in which it continued to select KBANK (Buy, TP Bt146.5) and KKP (Buy, TP Bt60.0) as the top stocks. 

While the MPC’s opinion estimates that in the short term, the Thai economy will still be affected by the new coronavirus outbreak (the impact of the new COVID-19 is not as severe as COVID-19 first round from controlling the outbreak which is not as strict as before), however, the results of government measures and exports recovering better which make the overall economy continued to expand. 

The Thai economy still faces low risks and high uncertainty which going forward, support is still needed from the sustained low policy interest rate. From these points, the Committee deems it appropriate to maintain the policy interest rate at this meeting and maintain a limited monetary policy capacity. 

Also, the Committee assesses the risk of the uncertainty of the recovery of foreign tourists, including the quality and effectiveness of the vaccination in the country.

 

WTI crude oil for delivery last March closed at USD55.69 a barrel, up 93 cents (+1.7%), the highest in one year after obtained the positive report on the U.S. crude oil reserves which the U.S. government’s Energy Information Administration (EIA) reported at 475.7mn barrels, down 1.0mn barrels last week. (Ends on 29 Jan). 

Also, oil reserves at Kuching, Oklahoma (The U.S. crude futures delivery point) fell 1.5mn barrels, in line with the American Petroleum Institute (API) report, the U.S. oil industry group that said it dropped 4.3mn barrels over the same period. The rebound in crude prices is partly due to the hope of a stimulus package from the U.S.

 

Core Investment

1) Global Play (Trading within 1 month) PTT, PTTEP, TOP, PTTGC and SCC

2) Green energy stocks (Trading within 3-6 months) GPSC, EGCO, GULF, BGRIM, BPP, BCPG, EA and ACE

3) Expectations for the vaccine and increased stimulus measures (Trading for 3-6 months) BBL, KKP, BEM, CPF, TU, M, OSP, CPALL, HMPRO, CRC and CHG

4) Stocks which expected that the performance in 4QQ20 w ill outstand ( 1-2 months) SAWAD, GULF, SPALI, ORI, WHA and STA

5) Dividend Play (Middle term trading 6-12 months) SC, LH, QH, KKP, TISCO, RATCH, DIF, INTUCH, EASTW and TTW

6) Long term accumulative stocks (DCA) (Long term trading over 1 year) AOT, BEM, AD VANC, WHA, LH, CPALL, CPF, BDMS, HMPRO, BBL and KTB