RTTNews - The Thai stock market has finished higher now in three straight sessions, gathering more than 25 points or 4.5 percent on its way to an 11-month closing high. The Stock Exchange of Thailand closed above the 640-point level, and analysts are looking for continued gains at the opening of trade on Tuesday.
The Asian markets can look to considerable optimism in Tuesday's global forecast as a resurgence in commodities and resources is predicted to lead the bourses firmly to the upside. Financials and steel stocks also are expected to provide support. The European and U.S. markets finished with strong gains, and the Asian markets are tipped to follow that lead.
The SET finished sharply higher on Monday, thanks to major gains among the financials, construction stocks and energy producers.
For the day, the index jumped 17.43 points or 2.79 percent to close at the daily high of 641.43 after dipping as low as 626.97. Volume was 4.316 billion shares worth 24.636 billion baht. There were 248 gainers and 78 decliners, with 112 stocks finishing unchanged.
Among the gainers, energy giant PTT gained 3.77 percent, while PTT Exploration and Production added 3.26 percent, PTT Aromatic was up 2.55 percent, PTT Chemical surged 8.75 percent, coal producer Banpu was up 5.07 percent, Siam Cement gained 7.61 percent, Kasikornbank jumped 3.79 percent and Siam Commercial Bank added 3.88 percent.
Wall Street offers a broadly positive lead as stocks saw a significant rally on the first trading day of August, fueled by better-than-expected economic data. The major averages all finished in positive territory, with the NASDAQ and the S&P 500 moving past the key technical levels of 2,000 and 1,000, respectively.
Notable buying interest was generated by a report from the Institute for Supply Management that showed a much slower than expected pace of contraction in manufacturing activity in July. The report also showed notable improvements in new orders and production. The ISM said its index of activity in the manufacturing sector rose to 48.9 in July from 44.8 in June, although a reading below 50 indicates a contraction. Economists had been expecting a more modest increase to a reading of 46.5.
Separately, the U.S. Commerce Department revealed that construction spending rose 0.3 percent in June following a revised 0.8 percent slide in May. The figure surprised economists, who had expected a decline of 0.5 percent for the month. The unexpected increase was largely due to a 1.0 percent increase in public construction. While private construction slipped 0.1 percent, residential construction spending was up 0.5 percent.
Some positive sentiment was also generated by news that Ford (F) reported its first increase in U.S. sales in nearly two years in the month of July. Ford said its sales rose 2.3 percent compared to the same month a year ago due in part to the government's Cash for Clunkers program.
In earnings news today, Humana (HUM) and Tyson Foods (TSN) beat Wall Street estimates, while traders are looking forward to the release of results from homebuilding stalwarts Centex (CTX) and Pulte Homes (PHM) after the closing bell this afternoon.
The major averages all closed sharply higher, with the NASDAQ ending the session at its best level of the day. The Dow closed up by 114.95 points or 1.3 percent at 9,286.56, the NASDAQ climbed by 30.11 points or 1.5 percent to 2,008.61, and the S&P 500 rose by 15.15 points or 1.5 percent to 1,002.63. With the gains, the NASDAQ closed above the 2,000 level for the first time since October, while the S&P 500 closed above the 1,000 level for the first time since November. The Dow also set a nine-month closing high.
In economic news, the Commerce Ministry said on Monday that Thailand's consumer prices dropped 4.4 percent on a yearly basis in July, following a 4 percent decline in June. Economists had expected only 4.3 percent annual drop. The core CPI that excludes fresh food and energy dipped 1.2 percent in July compared to a 1 percent fall in June. The Commerce Ministry forecasts consumer prices to drop as much as 1 percent this year. At the same time, the central bank estimates prices to fall up to 1.5 percent in 2009.
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