Putin Urged to Deploy Nuclear Weapons to Expedite War and Sever NATO Supply Routes

[David48]

This is what the Broker has released as their take on the situation.

Normally, I would only reproduce the first 3 lines, but, on this occasion, I hope more is permitted.

Event

On 22nd May, 2014 at 16.30 hrs, the Thai military, led by Gen.Prayuth Cha-ocha, Commander in Chief of the Royal Thai Army, declared a coup in an attempt to end the prolonged political conflict and begin the process of implementing political, economic and social reforms.

Impacts on the market

Short term:

The SET Index is expected to fall as foreign institutional investors are likely to reduce their portfolios due to restrictions under the coup. We estimate the support at 1,380/1,350 points.

Based on the data from the 2006 coup, the SET Index dropped by 1.46% on the first working day after the coup, and 1.98% and 2.95% in the first and second weeks following the coup, respectively.

Monthly:

One month and two months following the 2006 coup, the SET Index rose by 2.6% and 3.4%, respectively, with the lack of violence after the coup allowing consumers to regain confidence.

Viewing that the coup yesterday is quite similar to the one in 2006, we believe the market may react in similar ways. One month after the last coup, the most outperformed industries included the automotive sector, the food sector, the retail sector, and the banking sector.

In addition, the sectors that improved during the first three months after the coup were the healthcare sector, the retail sector and the food sector.

The next election:

A new election is unlikely to take place this year and people will have to wait for clarity regarding policies from the military. Note that after the 2006 coup, it took one year and three months before a new election was organized.

2014 SET Index:

We will revise our2014 SET Index target from 1,440 points currently, based on 14.4x P/E (five-year average +0.5SD), and estimated EPS growth of 11.7%. The upside would be that the index rises to 1,556 points if GDP were to exceed our base-case estimate at 2.0%, while the bottom-up approach target would be at 1,554 points.

Strategy

We recommend investing in equities at 60% of the total portfolio.

We suggest that investors buy on selective stocks, particularly on export stocks

(on the depreciation of the baht), as well as food and retail stocks (e.g., KCE, HANA, DELTA, TUF, CPF, GFPT and CPALL).

Moreover, investors are suggested to avoid tourism-related stocks as they may be impacted by an expected short-term decline in the number of tourist arrivals (note: in Sep-06 the tourist arrivals dropped by 19.6%MoM, comparing to average drop of 13%MoM during September).

In the medium term, the weakening of the SET Index provides a good opportunity to accumulate stocks; we recommend stocks linked to domestic consumption and investment (e.g., STEC, CPN, QH, SPALI, KBANK and SCB).

We believe consumers will regain confidence after the developments in regard to a new election become clearer

Balance of the article and finer detail is here

[JesseFrank]

Can you post the upcoming weather report as well please.

[David48]

Just saw that was my 12,000th post ...

Can you post the upcoming weather report as well please.

Jesse ... any rebuke, confirmation or thoughts on the OP.

Go on, rub your balls ... well, the crystal one anyway.

[SheungWan]

The SET will provide a more sober window on the political situation than all the witterings in the news section. A very decent broker analysis.

[VegasVic]

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Can you post the upcoming weather report as well please.

Any brokerage firm that has this exact (not to mention overly rosy) a forecast given the depths of uncertainty in Thailand currently, is either totally arrogant or totally clueless, or both What I know for certain is that there were 16 billion baht of net redemptions in the SET and Thai bond market on Friday alone by international investors, this was reported on BBC international business earlier today. It will be interesting to see if these redemptions continue over the ensuing weeks. As far as a month, 2 months , 6 months or a year from now goes nobody really has a clue, for all we know Thailand could be in the midst of an all out civil war a year from now (lets hope not)