Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>S&amp;P slips slightly on Monday after closing above 5,000 for the first time on Friday</li>
<li>Diamondback Energy +9% after announcing tie-up with Endeavour worth over $50 billion</li>
<li>Recruit reported Q3 results post close on Friday. US hiring remains in the doldrums, but cost cutting pushes EBITDA above expectations</li>
</ul>


S&amp;P slips slightly on Monday after closing above 5,000 for the first time on Friday
Diamondback Energy +9% after announcing tie-up with Endeavour worth over $50 billion
Recruit reported Q3 results post close on Friday. US hiring remains in the doldrums, but cost cutting pushes EBITDA above expectations


Ohayo Japan | S&P Slips but Stays Above 5k

<ul>
<li>Overseas: SPX +0.1% , Nasdaq +0.1%; Relatively stable day. Walmart stock -8% on cautious outlook, Burberry -9% on weak luxury spend</li>
<li>Today: NKY Futs -0.1% v cash. JPY 150.8/$; Japan to scrap quarterly reporting? Asahi Group Share Offering</li>
<li>ValueAct’s investment into Recruit highlights continued opportunities and value in the Japanese market</li>
</ul>


Overseas: SPX +0.1% , Nasdaq +0.1%; Relatively stable day. Walmart stock -8% on cautious outlook, Burberry -9% on weak luxury spend
Today: NKY Futs -0.1% v cash. JPY 150.8/$; Japan to scrap quarterly reporting? Asahi Group Share Offering
ValueAct’s investment into Recruit highlights continued opportunities and value in the Japanese market


Ohayo Japan | November Rally Takes a Rest; ValueAct Finds Value in Recruit

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

US Treasury (10 Yr Generic) / Technical Analysis

<ul>
<li>In our two previous Int'l Compass reports (Aug. 18 &amp; 24) we discussed that we were buyers on the pullback to the major $93 support level on MSCI ACWI (ACWI-US).</li>
<li>$93 on ACWI is 1+ year base support and a level that coincides with the 10-month uptrend. We remain bullish as long as the ACWI-US is above $93.</li>
<li>$93 on ACWI-US is likely the low for this pullback as long as the 10-year Treasury yield and DXY can stay below respective resistance levels (4.3%-4.35% and $103.70-$105.70).</li>
</ul>


In our two previous Int'l Compass reports (Aug. 18 &amp; 24) we discussed that we were buyers on the pullback to the major $93 support level on MSCI ACWI (ACWI-US).
$93 on ACWI is 1+ year base support and a level that coincides with the 10-month uptrend. We remain bullish as long as the ACWI-US is above $93.
$93 on ACWI-US is likely the low for this pullback as long as the 10-year Treasury yield and DXY can stay below respective resistance levels (4.3%-4.35% and $103.70-$105.70).


Further Declines in DXY, Sovereign Yields May Provide More Fuel for a Rally in Global Equities

<ul>
<li>Consumption is on the rebound as pandemic restrictions are lifted. Inflation has been higher than the 2% goal, but still not entrenched according to the BoJ. </li>
<li>JGB yields drifted lower despite higher consumer inflation. Lower producer prices may hint that supply issues are normalizing. Stocks are on fire</li>
<li>Bulls adding to Japanese semiconductor equipment names. Global backdrop of AI but Japan also benefits as a "safe haven" destination for new capital investments</li>
</ul>


Consumption is on the rebound as pandemic restrictions are lifted. Inflation has been higher than the 2% goal, but still not entrenched according to the BoJ. 
JGB yields drifted lower despite higher consumer inflation. Lower producer prices may hint that supply issues are normalizing. Stocks are on fire
Bulls adding to Japanese semiconductor equipment names. Global backdrop of AI but Japan also benefits as a "safe haven" destination for new capital investments


Japan Weekly | Nikkei +4.8% to 31 Year High, Advantest, Recruit, Makita

<ul>
<li>Japanese equities were marginally higher on the week as global markets continued to focus on problems in the banking system</li>
<li>The Fed, The Bank of England and the Swiss National Bank continued to fight the war on inflation.</li>
<li>In Japan, Recruit was the standout performer after the company announced a hefty cut to its workforce (in a bad news is good news kinda way)</li>
</ul>


Japanese equities were marginally higher on the week as global markets continued to focus on problems in the banking system
The Fed, The Bank of England and the Swiss National Bank continued to fight the war on inflation.
In Japan, Recruit was the standout performer after the company announced a hefty cut to its workforce (in a bad news is good news kinda way)


Japan Weekly | Financials Still a Concern, Recruit, Toyota Industries

Japan

Recruit Holdings Co. Ltd. operates information providing services in human resource, housing, bridal, travel, restaurants, beauty, automobiles, and education and more. The company also operate staffing services and advertising business.

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Recruit Holdings (6098 JP)

Ohayo Japan | S&P Slips but Stays Above 5k

S&P dips after reaching 5,000 milestone, Diamondback Energy surges on $50B deal, Recruit's Q3 results show cost cutting boosts EBITDA.

Mark Chadwick

Ohayo Japan | November Rally Takes a Rest; ValueAct Finds Value in Recruit

Walmart and Burberry stocks decline, Japan considers scrapping quarterly reporting, ValueAct invests in Recruit. Japanese market offers...

Mark Chadwick

Further Declines in DXY, Sovereign Yields May Provide More Fuel for a Rally in Global Equities

We continue to believe $93 on $ACWI is likely the low for this pullback as long as the 10-year Treasury yield $TNX and $DXY can stay below their...

Vermilion Research

Japan Weekly | Nikkei +4.8% to 31 Year High, Advantest, Recruit, Makita

The Nikkei 225 rose 4.8% and the Topix gained 3.1% on the week on signs of progress with the US debt ceiling, corporate updates, and foreign...

Mark Chadwick

Japan Weekly | Financials Still a Concern, Recruit, Toyota Industries

We share weekly commentaries with investors on stocks on our watchlists that have appreciated or dropped more than 10% during the week.

Mark Chadwick

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Ohayo Japan | S&P Slips but Stays Above 5k

​S&P dips after reaching 5,000 milestone, Diamondback Energy surges on $50B deal, Recruit's Q3 results show cost cutting boosts EBITDA.

Mark Chadwick

Ohayo Japan | November Rally Takes a Rest; ValueAct Finds Value in Recruit

​Walmart and Burberry stocks decline, Japan considers scrapping quarterly reporting, ValueAct invests in Recruit. Japanese market offers...

Mark Chadwick

Further Declines in DXY, Sovereign Yields May Provide More Fuel for a Rally in Global Equities

We continue to believe $93 on $ACWI is likely the low for this pullback as long as the 10-year Treasury yield $TNX and $DXY can stay below their...

Vermilion Research

Japan Weekly | Nikkei +4.8% to 31 Year High, Advantest, Recruit, Makita

The Nikkei 225 rose 4.8% and the Topix gained 3.1% on the week on signs of progress with the US debt ceiling, corporate updates, and foreign...

Mark Chadwick

Japan Weekly | Financials Still a Concern, Recruit, Toyota Industries

We share weekly commentaries with investors on stocks on our watchlists that have appreciated or dropped more than 10% during the week.

Mark Chadwick

S&P dips after reaching 5,000 milestone, Diamondback Energy surges on $50B deal, Recruit's Q3 results show cost cutting boosts EBITDA.

Walmart and Burberry stocks decline, Japan considers scrapping quarterly reporting, ValueAct invests in Recruit. Japanese market offers...