Mr. Poon Panichpiboon, Analyst at the Money Trading Room Krung Thai Bank revealed that baht Opened this morning (3 Dec) at 33.88 baht per dollar. It remained at its lowest level in two months from the previous day’s closing level. Looking at the baht frame today It is expected to be at the level of 33.75-33.95 baht per dollar.
Players in financial markets are gradually becoming more open to risks. Supported by the perspectives of different market players, it is expected that Oh Micron Although the epidemic is faster than the Delta, it may not be more severe and current vaccines can handle it.
The outlook prompted market players to return to buying risky assets that have retreated moderately on concerns about the previous buy-on-dip outbreak of Omicron, which drove the Russell 2000 small-cap index on the U.S. side. Up more than +2.5%, followed by the Dowjones +1.8%, supported by a gain in aviation and travel stocks such as Boeing +7.6%, while the S&P500 closed at +1.42%.
While the Nasdaq tech stock index rebounded only +0.83% due toTech stocks Still being pressured by the views of the Fed chairman as well as Fed officials who have voiced their support for accelerating tighter monetary policy, such as accelerating the QE cut. Amid concerns the Fed may accelerate and stay high for longer than previously estimated.
However, on the shoreeuropean stock market The STOXX50 Index dropped -1.7%, reflecting that the market is still reluctant to take risks from concerns about the economic slowdown from the current Delta outbreak, as well as the risk of the Omicron outbreak. The German government had to take more stringent measures to contain the outbreak. Especially for those who have not been vaccinated. In addition, European stock markets are still facing pressure from the sell-off of tech stocks. Amid concerns about the outlook for Fed’s tightening monetary policy, ASML -5.8%, Adyen -4.0%, Infineon Tech. -3.9%.
However, although the sentiment global stock marketsIt may recover following the US market, but we think it’s too early to jump to conclusions. The market correction may be over. Due to the high uncertainty of the Omicron epidemic And there is not much scientific information about Omicron. This may have to wait for confirmation from the vaccine company that the current vaccine is still able to cope with Omicron, which is expected to be reported within the next 1-2 weeks. get main again It will open an opportunity to gradually accumulate interesting stocks.
The side of the Bond market The market picture is gradually becoming more open to risks. Including the trend of the Fed ready to accelerate the QE reduction, has encouraged the US 10-year bond yield rose to reach 1.43%. But Bond Yield has not adjusted much. Reflecting that some players still have confidence in the situation of the outbreak. and choose to hold safe assets first Or there are some players waiting for the bond yield to rise to buy on dip, temporarily increasing the position of holding safe assets.
on the currency market side The dollar rebounded slightly. Recently, the dollar index (DXY Index) has been swinging at 96.16 points, supported by the US 10-year bond yield, which has risen in line with the market risk exposure trend. The US dollar was also driven by demand for safe-haven assets by some market players who remained concerned about market volatility. Market exposure and rising 10-year bond yields have pushed gold prices back down to $1,770 an ounce once again, which is likely. If markets start to ease concerns about the Omicron outbreak, which could be backed by science over the next 1-2 weeks, we view gold price upsides may start to be limited and that inflation concerns will be enough to support. The price of gold is not able to adjust strongly.
Incidentally, the most volatile market asset during the last night was the price of crude oil. The heavy correction of almost -4% after the OPEC+ group agreed to increase production by 400,000 barrels per day in January as previously planned. However, oil prices rebounded strongly and closed the market at the same level before the results OPEC+ meeting (latest Brent crude oil price at $70.5 per barrel) after market players estimate that OPEC+ may cut production or cancel the production increase. according to the situation of the oil market or the demand for energy which may be affected by the Omicron outbreak
For today, the market will wait for the highlight of this week’s economic data, which is the labor market data report. Particularly, nonfarm payrolls (NFP), which markets estimate that if NFP growth continues to improve, such as an increase of more than 500,000 jobs, it may encourage most Fed officials to support accelerating the QE cut. At this December meeting This would be in line with the views of the Fed chairman and other Fed officials who supported an accelerated QE cut from $15 billion to $30 billion last month. Causing the Fed’s QE to cease within the first quarter of next year.
On the Thai side, the market views that the continued economic recovery will support Headline Inflation (CPI) November However, the rise in inflation will not affect the Bank of Thailand’s (BOT) monetary policy decision as the BOT sees an acceleration in inflation from temporary factors and an accommodative monetary policy is still necessary. economic recovery
As for the baht trend, we view that the baht has a chance to face volatility on the weak side continuously from selling pressure on Thai assets, especially short-term bonds following the adjustment of foreign players’ speculative positions. Recently, foreign investors have sold short-term bonds throughout the week for more than 20 billion baht, with the pressure on the weaker baht mainly from concerns about the outbreak of Oh Micron.
in addition baht Still facing pressure from the falling gold price. This causes some players in the gold market to gradually come to Buy on Dip, but there is no chance of a gold price rebound. That will allow players to sell and make a profit. (Gold profitable flow will support the baht appreciation)
In addition, short-term technical signals still point to the baht’s depreciation pressure. As a result, foreign players are not in a hurry to speculate on the appreciation of the baht. However, we believe that the rhythm of the baht’s appreciation may occur in the next 2 weeks.
If scientific data indicates that Accelerating the mobilization of vaccines can stop the epidemic of omicron, so the global economic recovery may not be severely sluggish. The baht remains a key resistance in the 34.00 baht per dollar zone The Thai baht support level remains in the zone of 33.50-33.60 baht per dollar. from some importers’ dollar purchase force
Therefore, during this period, we estimate that The currency market still tends to be highly volatile. Traders should be more cautious in hedging foreign exchange risk and should use a variety of hedging tools such as options, which will help to increase efficiency in managing foreign exchange risk better.