InnovestX believes that economic activity will continue to deteriorate in 2023 due to a gradual increase in interest rates, which increases the likelihood of a recession in developed countries such as the United States and Europe. The company anticipates that the Federal Reserve will slash interest rates in 2023 as demand is expected to decline, resulting in a dollar depreciation.
This will boost emerging markets such as the Thai stock exchange, which is anticipated to profit from capital inflows. In addition, the Thai economy is still on the path to recovery from domestic consumption with economic stimulus measures as a supporting factor, as well as positive expectations for China's reopening in 2Q23. However, InnovestX is cautious about economic growth and earnings prospects in 2023, as well as rising risks to financial stability.
The company suggests investing in top equities in 1Q23 which will gain from China's reopening and the reviving Thai economy, namely AOT, BBL, BCP, CPALL, and MINT.
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