As the omicron outbreak continues, the Thai stock market may see a mixed trend in the first week of 2022, said the Country Group Securities on Tuesday.
Given that the Omicron strain of the coronavirus spreads more rapidly than the Delta variant, studies have suggested that the new variant causes milder symptoms due to less lung damage and a lower mortality rate.
The United States set a new daily COVID-19 case record as Omicron spread across the country. Last Wednesday (December 29), more than 498,000 infections were reported, whereas the death toll was only 0.4%, indicating a trend toward improvement.
Factors that could wreak havoc on the market; 1) Infections have hit new all-time highs everyday, which may result in a supply shortage and 2) Omicron cases in Thailand have climbed dramatically, with the most recent data as of January 2, totaling 1,551 cases. Traders and investors may closely monitor market movement. If it remains in the positive territory, the market is likely to place some weight on the outbreak. If it falls to negative territory, though, it may indicate that the market is concerned about the epidemic.
On the other hand, the market could benefit from the following: 1) Shop Dee Mee Kuen program (Shop and Payback) starting January 1, this will support retail and restaurant stocks, such as BJC, CPALL, CRC, DOHOME, HMPRO, ILM, CENTEL, M and MINT, 2) OPEC+ meeting on increasing production output; if the group decides to increase production by 400,000 barrels per day, the effect on oil prices will be limited, and 3) US economic data.
Country Group Securities forecasted that the SET Index would trade between 1,645 and 1,660 points this week, while recommending stocks that benefited from rising swine prices (CPF, TFG) and the Shop Dee Mee Kuen program (BJC, CPALL, COM7, DOHOME GLOBAL, HMPRO). Also, Laggard Play (BBL, BJC, CPALL, M, MAJOR, PTG) is recommended. Top Picks are CPF (TP: THB26.00) and BBL (TP: THB162.00).
