Market Watch: US announces plan to reopen, sends US and Asian stocks up

The United States unveiled its 18-page plan for “Opening Up America Again” on Thursday, sending US and Asian stock futures up.

Asian bourses traded up by around 2 per cent on Friday morning, in line with US shares. Japan’s Nikkei 225 was up by 2.68 per cent, South Korea’s Kospi was up by 3.41 per cent, Hong Kong’s Hang Seng was up by 2.37 per cent and China’s SSE Composite was up by 0.81 per cent. 

However, the Stock Exchange of Thailand (SET) has a more grim outlook on the first quarter results from the banking sector, as many experts and investors are cautious about the reopening of countries. The coronavirus outbreak is still spreading throughout many parts of the world and the possibility of a resurgence is still high.

Tisco Securities sees the index at 1190-1225 on Friday from the closing of 1200 points, down 35.95 points or 2.91 per cent on Thursday.    

Telecommunication

Five telecommunication providers will announce the reduction of phone bills to help people work from home, following the request from the National Broadcasting and Telecommunications Commission (NBTC). 

The NBTC is already providing ten gigabytes of data to 30 million mobile subscribers for free, and now, they have negotiated with providers to decrease bills for all packages by 10-30 per cent.

Thunhoon reported on Friday morning that the NBTC’s secretary general Takorn Tantasith has said the bills will only decrease by 5 per cent ahead of the official announcement from providers on Friday. 

Land and Houses Securities said the NBTC is now paying providers about 3 billion baht for the free 10GB of internet in terms of compensation. They said if the bills lower by 5 per cent, the compensation for this scheme would cost approximately 3 billion baht as well.  

The firm said if the bills are lowered by 10 per cent for three months, the earnings per share for the three companies will be reduced by 0.04 baht, 0.28 baht and 0.53 for TRUE, DTAC and ADVANC respectively.     

They added that since ADVANC has the biggest profit base, the impact from the lowered phone bills would be minimal for them and they suggest investors buy ADVANC and INTUCH at the target price of 210 and 67 baht. 

Bualuang Securities provided a scenario for 10-30 per cent discounts: ADVANC, DTAC and TRUE revenues could decrease by 0.5-1.7, 0.6-1.9, and 0.4-1.4 per cent respectively and their profits could then go down by 1.4-4.7, 5.8-17.3 and 38.1-124.2 per cent.   

The firm said they would choose ADVANC and INTUCH as their top picks, as ADVANC has the most 5G licenses from the previous auction in February.

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