Market Watch: SET could recover as Dow Jones lost 2000

The Dow Jones index lost more than 2000 points during trading on Monday, its largest one-day drop in history while the US government bond yield also hit a record low as the outbreak of the coronavirus and war on oil prices continued. 

Oil prices dropped by another 24 per cent as Saudi Arabia, the world’s largest oil exporter, said they would discount their crude oil and raise production next month amid weak global demand from the coronavirus outbreak.

Krungsri Securities said the Stock Exchange of Thailand (SET) should be swinging in the range of 1240-1270 after a drop of more than 100 points on Monday. The index opened at 1256 on Tuesday. They said the outbreak has surpassed the psychological mark of 100,000 confirmed cases while the shutdown in Italy will inevitably affect the EU’s economy.

With Saudi Arabia saying they would increase production to 10 million barrels per day in April, from the current 2 million barrels per day at US$6 to US$7 a barrel, oil prices will continue to put pressure on the SET. Around 30 per cent of the index is energy stocks. 

Some positive news that could halt the selling of shares and the exodus to safe havens is the prospect of easing measures from the European Central Bank (ECB) and the US Federal Reserve at their next respective meetings on March 12 and March 17-19.

Yuanta Securities said the SET will slightly recover on Tuesday but the upside is limited with the drop of Dow Jones. Crude oil prices were already increasing in the morning by 3 to 4 per cent, which should help energy shares. 

Finansia Syrus Securities expect the index to swing in the range of 1220-1270 points from expected technical rebounds. They recommended investors keep cash while concentrating on shares within the defensive group.  

COVID-19

Covid-19 leaves Gen Z among the impacted group of people, while women beat men in being stressed out

The impact of Covid-19 outbreak was not just on the health and economy of the people of Thailand but...

Latest article