Asian stocks fell as Chinese manufacturing activity fell to a six-month low, but upbeat factory data from the US on Thursday brought a revival. Political woes still clouded the Thai stock market, with sell-offs of stocks perceived, rightly or wrongly, to be linked to ousted premier Thaksin Shinawatra such as ADVANC, INTUCH and SC. The sales followed a call by anti-government protest leader Suthep Thaugsuban to boycott the companies.
The SET Index moved in a range of 1,295.74 and 1,333.30 points before closing at 1304.21, down 0.6% from the previous week, in moderate trade averaging 31.57 billion baht a day. Foreign investors were net sellers of 2.75 billion baht. Domestic retail investors were net buyers of 4.45 billion, brokers were the net sellers of 1.94 billion and institutional investors bought 246 million baht more than they sold.Big movers: AEC was the top gainer, up 379% to 2.30 baht. The top loser was NEW, down 12.1% to 59.75 baht. GSTEEL led in trading volume, up 87.5% to 0.15 baht, and AOT led in turnover, up 4.5% to 184 baht.
- Moody’s Investors Service affirmed Thailand’s government bond rating at Baa1 with a stable outlook, noting that Thailand’s credit fundamentals have withstood several rounds of political turbulence since the September 2006 coup.
- The Government Savings Bank (GSB) saw withdrawals of more than 100 billion baht by customers who saw its 5-billion-baht loan to the Bank for Agriculture and Agricultural Cooperatives (BAAC) as a way to help the caretaker government avoid legal restrictions in raising funds to pay rice farmers. President Woravit Chalimpamontri resigned and the loan was withdrawn.
- Standard & Poor’s said spikes in withdrawals at the GSB reflected increasing political risk in the country’s financial system, though the sector remains stable. Fitch Ratings expressed similar concerns.
- The Civil Court upheld the state of emergency imposed but prohibited the government from using force to disperse protesters.
- The National Economic and Social Development Board (NESDB) cut its economic growth forecast to 3-4% after fourth-quarter 2013 expansion of only 0.6%, bringing full-year growth in 2013 to just 2.9%, down from 6.5% a year earlier.
- CIMB Thai Bank expects its bad loans will increase by one percentage point this year to 3.5% in the worst case-scenario amid the stuttering economy, escalating political uncertainty and swelling household debt.
- Ampon Kittiampon has resigned as chairman of Thai Airways International, effective from March 10. The board appointed vice-chairman ACM Prachin Chantong to replace Mr Ampon. THAI will maintain its sales projection this year at 200 billion baht and targets earnings before interest, tax, depreciation and amortisation (EBITDA) of at least 20 billion baht but a political cloud still hangs over its business performance.
- Net public debt in December rose by 56.3 billion baht from November, the Public Debt Management Office reported. Outstanding public debt totalled 5.44 trillion as of Dec 31, or 45.7% of GDP. Of the total, 5.08 trillion baht, or 93.2%, was domestic debts and 369 billion, or 6.8%, was overseas debt.
- Given political tensions, Pruksa Real Estate Plc said it would delay land purchases, advertising and condo launches until the second quarter.
- Sansiri Plc plans to launch only nine new condos worth a combined 17.6 billion baht this year, blaming the low number largely on political instability.
- Banpu Plc, Asean’s largest coal miner, said 2013 net profit fell 62% to US$103 million due to unfavourable global coal prices.
- Domestic car sales hit a 25-month low in January, as the political impasse and late payments to rice farmers weakened potential buyers’ spending, while the expiry of the first-time car buyers scheme makes new purchases less attractive. The Federation of Thai Industries (FTI) forecasts sales of just 60,000 to 70,000 units a month this year compared with an average 100,000 in 2013.
Coming up this week: The Election Commission today will ask the court to rule on the authority to arrange a new election.
- Caretaker PM Yingluck Shinawatra is set to acknowledge accusations by the NACC on the rice pledging scheme on Thursday.
- Euro zone PMI and consumer confidence figures for February will be released on Thursday.
Stocks to watch: Bualuang Securities suggests selling KTC as the company is likely to increase its provisions amid the tougher economic environment. The brokerage has buy recommendations on BANPU, MAKRO and BCP. Asia Plus Securities recommends buying ADVANC and BANPU.
Technical View: Asia Plus sees support at 1,270 and resistance at 1,320. Tisco Securities sees support at 1,295 and resistance at 1,320.
