Stocks in Asia Mixed as Investors Monitor Fed’s Movement toward Policy Rate and QE

Stocks in Asia traded mix on Monday as investors continued to monitor the U.S. Fed’s action toward a potential of lowering policy rate and QE to support the rising inflation rate.

 

As of 9:42 local time in Thailand on May 24, 2021, Nikkei rose 0.19%, SSEC fell 0.32%, HSI dipped 0.87%, ASX 200 gained 0.06% and Kospi decreased 0.55%.

 

Krungsri Securities (KSS) expected the SET Index to fluctuate in a range of 1,545 – 1,565 points, despite the positive sentiment in the market from the U.S. and the eurozone strong economic data, especially the PMI and the manufacturing and services sectors.

However, KSS expected foreign fund flows to continue flowing out in concerns of the Fed to raise interest rates and lower QE in line with inflation. The high number of Thai Covid-19 cases will also pressure the Thai stock market as well..

 

KTBST Securities (KTBST) expected SET Index to move in the range of 1,530-1,570 points for a period of time, while most investors would delay the investment due to a limited upside and movement in this situation.

KTBST expected investors to speculate on stocks benefiting on baht depreciation and the report of export date to be announced this week, such as KCE and SUN. Moreover, KTBST recommended investors to keep an eye on the news release of corporates that could potentially have an impact on the share price and to speculate prior to the rally.

Finansia Syrus Securities (FSS) stated that SET Index is expected to continue to move sideways to rebase at 1,540-1,560 points without new positive factors to drive the market. As for the domestic factor, the COVID-19 epidemic had not been clearly improved, so FSS estimated that the domestic play segment to have a limited recovery than the global-play strategy. Meanwhile, medium-small stocks would continue to outperform the market. Thus, FSS recommended “speculation” on stocks with individual positive factors and low valuation.