Thai Stocks Trade Lower amid Rising Covid-19 Cases and Lockdown Fears

The Thai stock market opened lower at the opening bell on Monday, June 28, 2021, as the country reported an additional 5,406 new Covid-19 cases, which was higher than the normal level around 3,000-4,000 cases a day, coupled with the new lockdown restriction recently imposed on late Saturday.

 

SET Index opened at 1,566.00 points, representing 16.67 points or 1.05% lower with a trading value of 4.11 billion baht.

As of 10:25 local time in Thailand, SET Index was at 1,572.49 points, decreased 10.18 points or 0.64% with a trading value of 15.8 billion baht.

 

The Royal Gazette on Saturday night published a statement indicating a lockdown restriction in Bangkok and five surrounding provinces, including Nonthaburi, Pathum Thani, Samut Praka, Samut Sakhon and Nakhon Pathom.

The restriction, which will be implemented for 30 days starting Monday, will allow restaurants to be only available for takeaway, while community malls and department stores will close at 9 p.m.

Activities involving a gathering of more than 20 people will be banned for the time being. Construction camp sites in the six areas will be shut down, and workers will not be allowed to move elsewhere to contain the new cluster that occurred in the campsite.

Moreover, there will also be checkpoints in four provinces of southern Thailand, including Narathiwat, Pattani, Songkhla and Yala.

 

Asia Wealth Securities (AWS) expected the SET this week (28 Jun – 2 Jul) to move in a range of 1,555-1,610 points. The SET has a chance to continue to fluctuate from the previous week despite the decline for the second consecutive week, a total of 54 points (-3.3%). Foreign factors were slightly less concerned after the U.S. PCE and core PCE index rose in May, but lower than the Market Consensus expected.

However, China’s stance remains to be monitored in a ceremony of 100th anniversary of the founding of the Communist Party of China (1 Jul) after the G7 summit, the market regained its weight on global trade. The domestic factor will be an opening to welcome tourists in Phuket through the Phuket Sandbox project.

For the short-term, AWS stated that it had a positive view for the tourism-related stocks, but must monitor the ability to carry out vaccinations in the country, including the amount of vaccine that is sufficient or not.

The strategy also focuses on stocks with unique positive factors and the share price remains laggard in the short term, stocks that benefit from work from home, and tourism stocks.

 

Core Investment

1) Laggard Play (Trading within 1-2 months) – ADVANC, CPF, KBANK, BBL, MTC, EGCO, SPALI, LH, WHA, BDMS, BEM and BJC

2) Countdown 120 Days Re-Opening (Trading within 3 months) – BAM, BA, BEM, BDMS, BJC, BTS, CPALL, ERW, CENTEL, CRC, SPA, HMPRO, WHA. AU and M.

3) Stocks expected good performance in 2Q21 (Trading 1-3 months) – BCH, CHG, HMPRO, GPSC, BPP, PTTGC, IVL, PTTEP, PTG, SONIC, KWM, ORI, SPALI, KKP, KBANK and MTC

4) Dividend Play (Middle-term trading 6-12 months) – LH, QH, ORI, SPALI, ADVANC, KKP, TISCO, STA, STGT, TMT, TVO and STI

5) Long term accumulative stocks (DCA) (Long-term trading over 1 year) – AOT, BEM, ADVANC, WHA, LH, CPALL, CPF, BDMS, HMPRO, BBL and KTB