Market Roundup
- Thai govvies remain supported last week mainly due to safe haven flows as global markets focused on Greece and China’s stock market selldown. However, we think players will grow cautious ahead of more data releases later in the month, comprising trade, BoP as well as manufacturing and car sales.
- In the short term (1-2 month horizon), Thai govvies should remain supported, especially if domestic macro data continue to disappoint. However, there will no support from an anticipated UST weakness and weaker THB with USD/THB near the 34.00 level currently. On the UST front, we await a bunch of US macro data, the Beige Book report, and Janet Yellen’s testimony to the House finance and Senate banking committees. In any case, last Friday, Yellen remarked she expects a Fed rate hike to occur this year as she sees signs of an improving US economy. This week we expect the 10T finding its way towards key resistance 2.50%, especially as we see Yellen repeating her view on a hike this year and possibly lessened worries out of Greece and China (China stocks showed small rebound last week).
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