Market Commentary and Intraday News

Thai Shares May See Mild Recovery

265 days ago

(RTTNews) - The Thai stock market gave up less than a point on Friday - but that was enough to snap the four-day winning streak in which it had collected almost 15 points or 1.2 percent. The Stock Exchange of Thailand remained just above the 1,235-point plateau, and now analysts are forecasting a positive bounce for the market at the opening of trade on Monday.

The global forecast for the Asian markets suggests bargain hunting after heavy damage last week, thanks to encouraging reports from the European Central bank and the U.S. Federal Reserve. The European and U.S. markets finished firmly higher on Friday, and the Asian bourses are expected to open in similar fashion.

The SET finished flat on Friday, bumped into the red by weakness from the energy producers.

For the day, the index eased 0.45 points or 0.04 percent to finish at 1.237.19 after trading between 1,230.93 and 1,238.02. Volume was 3.255 billion shares worth 35.728 billion baht. There were 293 decliners and 256 gainers, with 140 stocks finishing unchanged.

Among the decliners, energy giant PTT was down 0.90 percent, while PTT Global Chemicals plummeted 2.33 percent, PTT Exploration and Production shed 0.67 percent and Bangkok Bank fell 0.51 percent.

The lead from Wall Street is positive as stocks showed a substantial turnaround on Friday after moving lower in early trading. The markets benefited from a positive reaction to the latest reports regarding the world's central banks, which indicated that the European Central Bank is considering setting yield band targets under a new bond-buying program.

Setting a band is an option gaining in favor among central bankers, but the decision would not be made before the ECB's next monetary policy meeting on September 6.

Buying interest was also generated by news of a letter Federal Reserve Chairman Ben Bernanke sent to Rep. Darrell Issa, R-Calif., defending the Fed's actions to support the economy. In the letter, which was obtained by the Wall Street Journal, Bernanke also told Issa there is "scope for further action by the Federal Reserve to ease financial conditions and strengthen the recovery."

The early weakness followed the Commerce Department's report on durable goods orders in of July. While the report showed a much bigger than expected increase in durable goods orders, the increase was largely due to strength in the volatile transportation sector. The report also showed a continued decrease by a key indicator of business spending.

Traders also remained leery about the situation in Europe, where Greek Prime Minister Antonis Samaras held a meeting with Chancellor Angela Merkel. Samaras pledged that Greece will "stick to its commitments and fulfill its obligations" but noted that the debt-plagued nation needs "time to breathe" as it undertakes crucial reforms. Merkel did not immediately respond to the request for more time to implement reforms but stressed that Germany wants to help Greece remain in the eurozone.

The major U.S. averages moved roughly sideways going into the close, ending the Friday firmly in positive territory. The Dow jumped 100.51 points or 0.8 percent to finish at 13,157.97, while the NASDAQ rose 16.39 points or 0.5 percent to end at 3,069.79 and the S&P 500 advanced 9.05 points or 0.7 percent to close at 1,411.13. Despite the gains on the day, the major averages all moved lower for the week. The Dow fell by 0.9 percent, while the NASDAQ and the S&P 500 slid by 0.2 percent and 0.5 percent, respectively.

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