Prospect of Ukraine talks calms investors’ nerves

Prospect of Ukraine talks calms investors’ nerves

Recap: Global stocks rose yesterday as the announcement of talks between Russia and the US over Ukraine scheduled for next week helped ease investors’ concerns over geopolitical risks.

The SET index moved in a range of 1,680.83 and 1,718.55 points this week before closing yesterday at 1,713.2, up 0.82% from the previous week, with daily turnover averaging 93.8 billion baht.

Foreign investors were net buyers of 11.09 billion baht and brokerage firms bought 2.49 billion. Institutional investors were net sellers of 10.16 billion baht and retail investors offloaded 3.41 billion baht worth of shares.

Newsmakers: Oil prices retreated from eight-year highs after Russia said some troops were starting to return to their permanent bases after completing drills near the border with Ukraine. However, the US still believes an invasion is highly possible.

Gold backed down from an eight-month high above $1,900 an ounce after Russia agreed to meet with the US for talks over the Ukraine standoff, easing some geopolitical concerns that had fed demand for safe-haven assets.

Soaring US inflation rates are “not acceptable” but the health of the world’s largest economy is fundamentally sound thanks to policies that have mitigated the impact of the pandemic, Treasury Secretary Janet Yellen said this week.

Bringing down US inflation may require the Fed to overshoot its “neutral” target interest rate of 2%, says James Bullard, one of the more outspoken members of the Federal Open Market Committee.

China is seen as the most influential economic power in Southeast Asia, according to a new poll, although there’s caution over Beijing’s territorial positions over the South China Sea.

China will work with Asian countries to beef up the use of local currencies in trade and investment, said central bank governor Yi Gang, as part of plans to strengthen regional economic resilience.

Bitcoin dropped 7.4% on Thursday to $40,631.78 as risky assets in general took a beating because of worries about Ukraine. The world’s biggest cryptocurrency is down 15.3% from the year-to-date high of $47,989 set on Jan 2.

Risks involving non-fungible tokens (NFTs) and the metaverse are among key security threats to look out for in Hong Kong in 2022, according to the government-run cybersecurity watchdog Hong Kong Computer Emergency Response Team Coordination Centre.

Cyber crooks are embracing digital innovations including cryptocurrencies and deepfake technology so rapidly that law enforcement can barely keep up, the Federal Bureau of Investigation has conceded.

A global travel divide is deepening as some countries ditch Covid-19 restrictions including quarantines, isolation and even mandatory testing for good, while others cling to years-old curbs.

Singapore Finance Minister Lawrence Wong yesterday announced a package worth S$500 million to spur employment and help businesses recover from the pandemic as part of the government’s annual budget.

Vietnam on Wednesday finalised a plan to fully reopen its borders to foreign tourists from next month, as it looks to accelerate its economic recovery and revive a battered tourism sector.

Thailand faces limited risk from the global trend toward higher interest rates as most of the government’s debt is in long-term bonds with fixed interest rates, according to the Public Debt Management Office.

The cabinet on Tuesday agreed to cut the excise tax on diesel by three baht per litre, from the current 5.99 baht, for three months to help ease the impact of high energy prices on transport and consumer goods prices.

The government has approved provincial and provincial cluster development plans between 2023 and 2027 worth a combined 40.82 billion baht for 1,854 development projects between 2023 and 2027.

The cabinet has approved subsidies ranging from 70,000 to 150,000 baht per vehicle, along with incentives including import duty cuts, to promote electric vehicle consumption and production in 2022 and 2023.

New investors are expected to join the second phase of the waste-to-energy (WTE) programme this year and next, with electricity generation capacity of 600 megawatts, as continue to promote refuse-derived fuel.

Hotel operators are clamouring for RT-PCR testing on arrival for foreign visitors to be eliminated from the requirements for the Test & Go scheme.

The government has processed more than 100,000 applications since Test & Go resumed on Feb 1, but efforts to revive tourism still face hurdles. Hotel tycoon Bill Heinecke recently criticised the programme, especially its two-PCR-test requirement, as “onerous”.

Tourism operators in Pattaya hope Indian travellers can provide some relief during the upcoming low season as the Tourism Authority of Thailand prepares marketing plans for the South Asian country under a travel bubble programme.

The government is planning to reopen the Thai-Malaysia border next month to stimulate tourism and the economy in the southernmost provinces.

Thailand shows a strong level of digital readiness with a high penetration rate for internet usage, social media engagement, mobile connections, online shopping and digital payments, according to the “Digital 2022: Thailand” report.

Demand for larger condominium units in the resale market is poised to remain strong this year as prices of units in new projects in Bangkok are still high despite smaller sizes, according to the property consultant CBRE Thailand.

AirAsia Aviation Group has announced plans for a low-cost ride-sharing air service in Southeast Asia, using at least 100 Vertical Aerospace VX4 electric aircraft from the lessor Avolon.

Thailand’s gem and jewellery exports excluding gold are expected to grow by 15-20% this year, driven by the global economic recovery, say local industry groups.

The listed developer Property Perfect Plc (PF) plans to launch 15 low-rise housing projects this year worth 26.2 billion baht, nearly half of them joint ventures with Hongkong Land and Sumitomo.

Kasikornbank (KBank) has launched the Go Green Together project to serve both retail and corporate customers as part of its effort to build the country’s green ecosystem.

Coming up: New Zealand will release January trade figures, Germany will release February manufacturing PMI and Britain will release manufacturing, composite and services PMI on Monday. The People’s Bank of China will announce the prime lending rate.

Germany will release the February business climate index and expectations on Tuesday, and the US will release February consumer confidence, manufacturing and composite PMI. The Reserve Bank of New Zealand will announce its interest rate decision on Wednesday, and the euro zone will release January inflation.

The US will release revised fourth-quarter GDP and January new home sales on Thursday. New Zealand will release fourth-quarter retail sales and Germany will release fourth-quarter GDP on Friday. Due the same day in the US are January durable goods orders, personal consumption and pending home sales.

Stocks to watch: SCB Securities recommends stocks with strong operating results in 2021 expected to benefit from continuing reopening of the economy. Top picks include KBANK, SPALI, AMATA, LH, GULF, DELTA, VANC, ONEE, CRC and MINT. Stocks that will benefit from the recovery in local consumption include CRC, AP, SPALI, AH and ONEE.

Krungsri Securities recommends stocks expected to offer high dividend payouts. Its top five are TISCO, SIRI, BCH, AP and CHG. Stocks with a potential to report net profits and growth in 2021 are ROJNA and CRC. Large-cap stocks that are targets for foreign investors are VANC and INTUCH.

Phillip Capital noted that about 50 billion baht has flowed into the Thai stock market in the month to date. The brokerage recommends investing in large-cap stocks including SCB, KBANK, BBL, AOT, PTT, PTTEP, PTTGC and IVL.

Technical view: UOB Kay Hian Securities sees support at 1,690 points and resistance at 1,740. DBS Vickers Securities sees support at 1,680 and resistance at 1,730.