Daily Strategy for Investors on October 2, 2019

Asia Wealth Securities (AWS) has made an analysis for the trading session on October 2, 2019, pointing out some of the must-know events in the equity market as follows:

 

Investment Ideas:

1) Negative factors from the weak global economy outlook will return to put pressure on the investment once again after the WTO announced to lower the global trade growth estimate for 2019 to 1.2% from the previous estimate of 2.6% in April and expects the 2020 global trade growth to be at 2.7% (formerly 3.0%).

2) ISM reported the US manufacturing index in September was at 47.8 points which was the lowest in almost 10 years or down by 49.1 points in August and lower than analysts had estimated at 50.2 points.

3) VIX Index immediately increased by 14.3% to 18.56 points.

4) The short-term domestic issues that should be monitored are the estimation and a gradual announcement of performance by banking sector.

5) Today, AWS has estimated the index range at 1,615 – 1,635 points.

6) Investment strategy: remains focusing on selective domestic stocks benefitting from the recovery of tourism and government measures.

7) Today’s recommended stocks are AOT CPALL and ERW.

 

Stock & Comment

AOT – TP ฿74.25/share

CPALL – TP ฿94.00/share

ERW – IAA Consensus TP ฿7.30/share

 

Pick of the day: AOT (BUY; AWS TP Bt84.00)

Bank of Thailand reported the number of tourists in August is at 3.5 million, an increase of 7.4%YoY, with the number of Chinese tourists (27.6% of the total number of tourists) increasing by 18.9%YoY from (1) The number of Chinese tourists that decreased due to the boat crash in Phuket last year (The incident occurred on 5 July 61) (2) The positive factors from visa on arrival fee exemptions, especially for tourists from China, India and Taiwan, and (3) The unrest in Hong Kong (Political protest) causing Chinese tourists to change the route from Hong Kong to Thailand.

AOT’s air transport statistics, between 1 – 28 September, the total number of flights increased by 1.3%YoY and the total number of passengers increased by 4.3%YoY as foreign passengers grew by 10.3%YoY. The number of tourists is a positive signal to the tourism overview and positive factor for AOT.

AOT is likely to be in an uptrend due to the Daily & Monthly Buy Signal waiting for the new Weekly Buy Signal. When the weekly market is closed above 74.25 baht, AOT will return to the main trend. That is an uptrend fully. When considering AOT, the first goal of making a New High is 77.75 baht. The AOT has a short stop-loss point of 72.25 baht. (Resistance: 74.50, 74.75, 75.50; Support: 74.00, 73.75, 73.00 )