Globlex Securities (GBS) assesses that the Thai stock market in May will experience a consolidation phase due to concerns over slowing economic indicators both domestically and internationally. Attention is on President Biden calling an urgent meeting with congressional leaders on May 9, following signals from the U.S. Treasury that there may not be enough funds to meet debt obligations. The index is expected to range between 1,500-1,560 points. It is recommended to invest in stocks that will benefit after the elections, including PYLON, SEAFCO, STEC, CK, CPALL, MAKRO, BJC, WHA, and AMATA.

Ms. Wilasinee Boonmasungtrong, Director of Research at Globlex Securities (GBS), predicts that the Thai stock market will continue to consolidate in May, reflecting signs of a slowdown in the Thai economy in March, particularly in exports. This aligns with weak economic indicators from abroad, including a slowdown in manufacturing indices in the U.S. and China, as well as France's credit rating being downgraded from "AA" to "AA-" due to budget deficit issues and high debt burdens. Meanwhile, the U.S. Treasury has revealed that it may run out of funds to cover all government expenses as early as June if the debt ceiling is not raised, prompting President Biden to call an urgent meeting with congressional leaders on May 9. Additionally, crude oil prices have sharply declined due to concerns over the U.S. potentially defaulting on its bond obligations, worries about a banking crisis in the U.S., and a weakening U.S. economy, leading to selling pressure in the energy sector. Therefore, the index is expected to range between 1,500-1,560 points.

Domestically, the sentiment remains negative as the Office of Small and Medium Enterprises Promotion (OSMEP) reported that in the first quarter of 2023, 53.4% of SMEs still faced increasing debt burdens, up from 44.7% in the fourth quarter of 2022. The rising proportion of non-performing loans is partly due to the economy not fully recovering and issues accessing funding. Meanwhile, the Shipping Council reported that export value in the first quarter declined by 4.5%, adjusting the annual export growth target to 0-1%, indicating that exports this year are unlikely to expand compared to last year.

There are also domestic factors to watch, such as on May 11, MSCI will announce the Rebalance list; on May 14, the election day; on May 15, the National Economic and Social Development Council (NESDC) will announce the GDP for the first quarter of 2023, which is also the last day for listed companies to submit their first-quarter financial statements for 2023; on May 23, the Joint Public and Private Sector Committee on Commerce (JPPCC) will meet; and on May 31, the third meeting of the Monetary Policy Committee (MPC) of 2023 will be held, along with the Bank of Thailand (BOT) reporting on the Thai economic situation. Additionally, on May 9, President Biden will convene Congress to discuss raising the U.S. debt ceiling to avoid defaulting on government bonds before the June 1 deadline.

Therefore, it is recommended to adopt an investment strategy in stocks that will benefit after the elections, including construction contractors, retail, and industrial estates such as PYLON, SEAFCO, STEC, CK, CPALL, MAKRO, BJC, WHA, and AMATA.

Regarding the direction of gold investment, Mr. Natthawut Wongyowarak, Director of Research at Globlex Securities, assesses that the overall gold price this month will be influenced by the FOMC meeting, where a 0.25% interest rate hike is expected. The market anticipates this will be the last rate hike by the Fed. The end of the rate hike cycle will support gold prices, and we expect the yield on 10-year bonds may break the key support level of 3.33%, which aligns with the dollar index potentially breaking below the 101.00 level, providing support for gold.

The research department estimates that gold prices may remain elevated due to the likelihood that most U.S. economic indicators will come in below expectations, especially as the rate hike cycle nears its end. Both of these factors will support gold prices in May. If prices dip during the month but do not fall below the $1,950/oz support level, it is recommended to gradually accumulate purchases.