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Technically, we had a trend reversal for the SET on Tuesday but the bounce on Wednesday was lousy. It wasn’t good end-of-the-month/quarter window dressing. The index is still moving in a shallow symmetrical triangle chart pattern and downside risk has significantly increased as it trades below the 1,370 resistance level. Someone piled onto Thailand 10-year government bonds and sent the yield nosediving 3.14%.
Foreign investors’ selling for the SET seemed to pick up again as the Thai baht weakened, with net sells this month of about 21.2 billion baht. The year-to-date foreign investors’ net sells top 107.5 billion baht, up almost 2,800% from the same period last year.
The U.S. nonfarm payrolls report will be released by the Labor Department on Friday. Wall Street economists' expectations are for a 203,000 gain. Some traders said the payrolls data could help strengthen, or weaken, the case for the Federal Reserve raising U.S. interest rates before the end of the year.
The federal funds futures, commonly used to estimate the market’s views on the likelihood of changes in U.S. monetary policy, indicate only 14% odds for a quarter-point rate hike at the October 28 policy meeting, while the odds are 41% at the December 2015 meeting, according to data from CME Group as of September 30. The federal funds futures could change depending upon the nonfarm payrolls data.
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