INVESTORS RATTLED BY FED TIGHTENING SIGNALS

RECAP: US equity-index futures rose yesterday while European stocks and the dollar fell, after stronger signals about Federal Reserve policy tightening produced steep declines in global stock markets earlier in the week, while investors awaited data on US employment gains.

The SET index moved in a range of 1,650.53 and 1,677.95 points this week before closing yesterday at 1,657.62, unchanged from the previous week, in daily turnover averaging 97.18 billion baht for four operating days.

Foreign investors were net buyers of 8.48 billion baht and brokerage firms bought 2.16 billion baht. Retail investors purchased 114.41 million baht and institutional investors were net sellers of 10.76 billion baht worth of shares.

NEWSMAKERS: China Mobile shares soared more than 9% on Wednesday in their debut on the Shanghai stock exchange after the telecoms giant was delisted in New York amid tensions between Beijing and Washington.

▪ US Federal Reserve policymakers believe higher inflation could warrant interest-rate increases “sooner or at a faster pace” than previously expected, according to minutes of their Dec 14-15 meting. Markets have interpreted this to mean the first move could come as soon as March.

▪ The Nikkei index in Tokyo sank 2.9%, the most in six months, on Thursday as investors sold expensive growth stocks after hawkish US Federal Reserve meeting minutes sparked a sell-off on Wall Street.

▪ The Japanese carmaker Toyota led US automobile sales in 2021, according to figures released Tuesday, overtaking General Motors for the first time as a shortage of semiconductors roils the car industry.

▪ The electronics giant Sony has unveiled a new prototype of its Vision-S electric vehicle and announced the founding of a company to explore jumping into the rapidly growing market.

▪ The Vietnamese automaker VinFast will stop making petrol-powered cars by the end of this year — just two-and-a-half years after it started — as it ramps up global sales of electric SUVs with plans for factories in the US and Germany. Foreigners were net purchasers of Asian equities in December but the inflows paled in comparison with the massive outflows faced throughout last year, as regional stocks were hit by a strong dollar and the impact of Covid-led curbs. Outflows for the year totalled $35 billion, the most since 2008, market data showed.

▪ Bitcoin fell below $43,000 on Thursday, testing multi-month lows after Fed meeting minutes showed policymakers leaning toward more aggressive policy action. The world’s largest cryptocurrency set a record high of $69,000 just two months ago.

▪ The government of El Salvador is drafting bills to provide investors with “legal certainty” as it prepares to offer the world’s first bitcoin bonds, Finance Minister Alejandro Zelaya said on Tuesday. The first such issue, worth $1 billion, would carry a coupon of 6.5%.

▪ Uranium prices have jumped 8% this week as Kazakhstan, which produces 40% of the world’s supply, struggles to cope with deadly protests that pose the biggest challenge to the country’s leadership in decades.

▪ The spread of the Omicron coronavirus variant in Thailand could have a larger and more prolonged impact than expected on an economic recovery, according to minutes of the most recent Bank of Thailand policy meeting.

▪ The cabinet approved on Tuesday a fiscal 2023 budget worth 3.185 trillion baht, up 2.7% from the current fiscal year, with a deficit of 695 billion, down 0.7%.

▪ GDP growth in the Thai industrial sector is forecast to ease to between 2.5% and 3.5% this year, from an estimated 3-4% last year, due to a mix of factors, including the impact of Omicron, says the Office of Industrial Economics (OIE).

▪ The baht fell the most since late November after the government raised the Covid-19 alert to the second-highest level, further dimming the recovery outlook for the tourism sector.

▪ Despite a sharp rise in prices of fresh food such as vegetables, pork, eggs, cooking oil, rice and curry, the Commerce Ministry is maintaining its headline inflation forecast in the range of 0.7% to 2.4% (average of 1.5%) this year.

▪ Commerce Minister Jurin Laksanawisit has ordered the temporary suspension of swine exports to combat skyrocketing local pork prices. Thousands of small farmers have exited the industry, citing high costs, resulting in a plunge in pig supplies.

▪ The Revenue Department is in talks with digital asset exchanges to enable the latter to collect 15% withholding taxes on cryptocurrency profits, says department spokeswoman Sommai Siriudomset.

▪ The Securities and Exchange Commission is moving to assert control over the trade in non-fungible tokens (NFTs), saying operators of NFT marketplaces must apply for licences. But analysts say tighter regulations will drive many market participants to flee to foreign platforms. Bitkub Online, the country’s leading digital asset exchange, aims to increase its customer base to 7 million and expand its services abroad this year, starting in Southeast Asia.

▪ Popular tourist destinations face more cancellations as the suspension of the Test & Go entry scheme looks to bring an early end to what was already a limited high season. The sector faces losses of up to 7 billion baht in January and a severe blow to confidence in the long run, according to the Tourism Council of Thailand (TCT).

▪ Phuket will remain open to tourists through its Sandbox programme despite a sharp rise in new Covid infections, its governor said, allaying fears over a possible lockdown among business operators.

▪ While the Test & Go programme has been suspended indefinitely, authorities yesterday offered a compromise by recommending aditions to the Sandbox programme: three islands in Surat Thani province — Koh Samui, Koh Tao and Koh Phangan — along with the provinces of Krabi and Phangnga.

▪ Hoteliers in Phuket are preparing to offer hotel isolation for asymptomatic guests in order to keep the reopening programme alive, as more guests refuse to pay for pricey hospital beds.

▪ The Export-Import (Exim) Bank of Thailand has provided financial assistance to local airlines totalling more than 6.2 billion baht to increase their liquidity and restructure their debt, says bank president Rak Vorrakitpokatorn.

▪ Siam Commercial Bank (SCB) has prepared long-term debt restructuring for customers to help them survive the prolonged pandemic.

▪ Advanced Info Service (AIS), the country’s largest mobile operator by subscribers, aims to seal two major partnership deals this year in a drive to complement its existing digital service.

▪ Mostly state-owned Bangchak Corporation Plc (BCP) has paid 1.6 billion baht for the right to carry its fuel through a pipeline network overseen by Fuel Pipeline Transportation Co (FPT) to reduce transport costs and support a campaign against climate change.

▪ Coming up: The euro zone will release November unemployment figures on Monday. Australia will release November retail sales on Tuesday and Britain will release November industrial production, manufacturing production and trade data.

▪China will release December consumer prices on Wednesday. The euro zone will release November industrial production and the US will release December consumer prices.

▪ The US will release a December federal budget update and producer prices on Thursday. China will release December trade figures on Friday, and the US will release December retail sales, export and import price index and industrial production.

STOCKS TO WATCH: Trinity Securities recommends two investment themes for January — businesses focused on domestic consumption and high-dividend stocks — as new economic stimulus measures will support local consumption growth. Its picks are KBANK, BBL, BJC, CPALL, HMPRO, DOHOME, COM7, M, ORI, SPALI, SIRI, BEM, BTS, PLANB, MAJOR and VGI. For high-dividend stocks, the brokerage recommends SCC, TISCO, AP, ADVANC, PTT, INTUCH, BBL, LH, GUNKUL, PTTEP, SIRI, SENA, SC, MAJOR, TOG and PSH.

Tisco Securities recommends investment in value stocks and high-dividend stock for the first half of the year. Its top picks are ADVANC, BDMS, DTAC, EGCO, KKP, SCB, SPALI and WHA. For monthly picks, the brokerage recommends BEC, BJC, DCC, KKP, TPIPL and TVO.

TECHNICAL VIEW: DBS Vickers Securities sees support at 1,640 points and resistance at 1,690. Tisco Securities sees support at 1,650 and resistance at 1,690.