GRADUAL REOPENINGS STOKE SHARE INVESTOR OPTIMISM

RECAP: Global stock markets ended the week on a higher note yesterday as the gradual reopening of business activity and economies fed optimism that the Covid-19 pandemic might be contained soon.

The SET index moved in a range of 1,252.00 and 1.289.09 points this week before closing at 1,266.02, down 2.7% from the previous week, in turnover averaging 50.57 billion baht for three trading days.

Retail investors were net buyers of 11.86 billion baht worth of shares. But foreign investors were net sellers of 9 billion baht, institutional investors sold 2.5 billion and brokerage firms offloaded 384.8 million baht in shares.

NEWSMAKERS: China said on Thursday that it supports the World Health Organization (WHO) in trying to pinpoint the origins of the Covid-19 pandemic, and accused US Secretary of State Mike Pompeo of telling “one lie after another” in his attacks on Beijing. The WHO said earlier that Washington had provided no evidence to support “speculative” claims by President Trump that the virus originated in a Chinese lab.

■„ John Ratcliffe, US President Donald Trump’s pick to become director of national intelligence, said he would focus on China as the country’s greatest threat, saying Beijing was determined to supplant the United States’ superpower position.

■„ New Delhi has imposed a special tax of 70% on retail liquor purchases in order to deter large gatherings at stores as authorities ease the sixweek lockdown imposed to slow the spread of the coronavirus.

■„ The speaker of the Malaysian parliament has accepted former premier Mahathir Mohamad’s application to move a motion of no-confidence against his successor Muhyiddin Yassin, but it is not clear whether a debate will take place when legislators reconvene on May 18.

■„ Japanese Prime Minister Shinzo Abe on Monday extended a state of emergency until the end of May, warning it was too soon to begin relaxing restrictions aimed at curbing the virus.

■„ Hong Kong’s economy slumped 8.9% in the first quarter, its worst annual contraction since at least 1974, as the pandemic dealt a heavy blow to business activity, already in decline following months of protests last year.

■„ The European Central Bank has stood firm after Germany’s top court questioned its massive bond-buying stimulus scheme, vowing to do “everything necessary” to fulfil its mandate of ensuring price stability.

■„ Malaysia’s central bank on Tuesday cut its benchmark interest rate by 50 basis points to 2% as the pandemic threatens to plunge the country into a recession.

■„ General Electric is cutting an additional 10,000 jobs from its aviation sector as the pandemic decimates the industry, forcing companies to cancel orders.

■„ The home-sharing platform Airbnb will lay off one-quarter of its workforce — some 1,900 people — as the virus crushes the travel industry.

■„ The Public Debt Management Office is poised to secure 54 billion baht in bridge loans to prop up Thai Airways International Plc (THAI) while it undertakes a rehabilitation plan. Prime Minister Prayut Chan-o-cha has already warned that this rescue package will entail a full restructuring and there will be no second chances.

■„ Despite government financial support, the next challenge for Thailand’s aviation industry is how to cope with low liquidity and a drastic drop in revenue for a potentially long period of time, says Tris Rating.

■„ Thailand may see the economic impact from the coronavirus pandemic spread over another nine months, Gen Prayut said on Tuesday, as disruption from the global crisis drags on tourism and domestic activity.

■„ Gen Prayut has raised the prospect of a two-hour time limit on shopping centre visits under the next stage of lockdown easing, expected to take effect on May 17.

■„ Consumer prices fell 2.99% in April from a year earlier, the largest decline in more than 10 years and sharply below expectations, Commerce Ministry data showed.

■„ Thailand’s cross-border trade fell by 7.6% year-on-year in the first quarter as the coronavirus hit the global economy and closed numerous checkpoints.

■„ Thai exports in 2020 are likely to contract by 5-10%, worsening from an earlier projection of a 2% decline, says the Joint Standing Committee on Commerce, Industry and Banking.

■„ Stores that fail to enforce disease control measures were warned they will be ordered closed, no matter how big they are, following chaotic scenes as people rushed to buy booze when the ban was lifted last Sunday.

■„ Hundreds of hotels in Thailand are crying foul after the giant European tour operator TUI Group asked to delay repayment of debts that have reached 2 billion baht.

■„ The Finance Ministry has extended the deadline until May 15 for rejected applicants for the 5,000-baht monthly assistance fund to file appeals. Some 13.4 million non-formal workers have been approved and 1.7 million rejected.

■„ The increase in the price index for vacant land near the extension of the northern section of the Green Line and the Pink Line exceeded the average for Greater Bangkok.

■„ SET-listed Thai Union Group (TU), a global seafood conglomerate, reported a 20.2% year-on-year fall in first-quarter net profit despite strong sales because of foreign-exchange losses and lower equity income.

■ SET-listed Pace Development (PACE) and subsidiary Pace Country Club have filed a business rehabilitation plan to continue development of the Nimit Langsuan real estate project and transfer ownership to customers.

COMING UP: Australia will release April business confidence on Tuesday, with China and the US announcing April inflation data.

■„ Australia will release May consumer confidence and Britain will release preliminary first-quarter GDP data and March trade figures on Wednesday.

■„ The euro zone and Germany will release first-quarter GDP data on Friday, with the US announcing April retail sales.

STOCKS TO WATCH: Asia Plus Securities foresees more interest-rate cuts as leading economic indicators have been even worse than expected, with headline inflation remaining in negative territory. Its top stock picks are BCP, DCC and STA.

Capital Nomura Securities recommends a dollar-cost averaging strategy to accumulate shares in sustainable businesses. Its recommendations are ADVANC, AOT, CPALL, CPF, BEM, BDMS, HMPRO, KTC and TASCO. Shares expected to be included in the MSCI index revision are AWC, TOA and KTC, while BANPU is poised to be withdrawn.

TECHNICAL VIEW: Maybank Kim Eng Securities Thailand sees support at 1,200 points and resistance at 1,287. DBS Vickers Securities Thailand sees support at 1,230 and resistance 1,280.