Index Rebalance and Special Situations, Quiddity Advisors

Afridi Reyal

Index Rebalance and Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

<ul>
<li>The ES50 Index is one of the most highly-tracked European indices and the annual index review takes place in September every year.</li>
<li>We expect capping flows in the December 2026 quarterly rebal and no fast-entry/exit index changes.</li>
<li>We also expect no changes at the September 2027 annual review, though a few names are near the border and some large names are held back by the sector test.</li>
</ul>


The ES50 Index is one of the most highly-tracked European indices and the annual index review takes place in September every year.
We expect capping flows in the December 2026 quarterly rebal and no fast-entry/exit index changes.
We also expect no changes at the September 2027 annual review, though a few names are near the border and some large names are held back by the sector test.


Quiddity Leaderboard ES50 Sep27: No Changes Likely; Sector Test Holding Big Names Back

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

<ul>
<li>Since late-February (2/25/25 Compass and 2/27/25 Int'l Compass) we had been expecting an 8-10% pullback to provide a buying opportunity.</li>
<li>However, after getting the 10%+ pullback, we discussed in 4/1/25 and 4/3/25 reports how we no longer saw it as a buying opportunity, and we downgraded our outlook to bearish/cautious</li>
<li>While it is possible that the lows are in, we now are looking for the ACWI-US rally to fizzle, either here at $113.50-$115 or the 200-day MA (~$118).</li>
</ul>


Since late-February (2/25/25 Compass and 2/27/25 Int'l Compass) we had been expecting an 8-10% pullback to provide a buying opportunity.
However, after getting the 10%+ pullback, we discussed in 4/1/25 and 4/3/25 reports how we no longer saw it as a buying opportunity, and we downgraded our outlook to bearish/cautious
While it is possible that the lows are in, we now are looking for the ACWI-US rally to fizzle, either here at $113.50-$115 or the 200-day MA (~$118).


Still Bearish/Cautious; Stick With Defensives; Emerging Market Opportunities

<ul>
<li>Since late-February (2/25/25 Compass and 2/27/25 Int'l Compass) we expected an 8-10% pullback to provide a buying opportunity.</li>
<li>But that all changed last week (4/1/25 Compass and 4/3/25 Int'l Compass), when we downgraded our outlook to bearish/cautious, citing several concerning developments.</li>
<li>Despite the 90-day pause, we remain cautious and we continue to favor defensives as long as the S&amp;P 500 and ACWI-US are below their 200-day MAs.</li>
</ul>


Since late-February (2/25/25 Compass and 2/27/25 Int'l Compass) we expected an 8-10% pullback to provide a buying opportunity.
But that all changed last week (4/1/25 Compass and 4/3/25 Int'l Compass), when we downgraded our outlook to bearish/cautious, citing several concerning developments.
Despite the 90-day pause, we remain cautious and we continue to favor defensives as long as the S&amp;P 500 and ACWI-US are below their 200-day MAs.


Still Favor Defensives Until Market Dynamics Improve; EURO STOXX 50 Testing Crucial 5000 Level

Singapore Telecommunications / Technical Analysis

<ul>
<li>We have been expecting near-term downside on ACWI-US and the S&amp;P 500 since our February 27 Int’l Compass, when both ACWI-US and the S&amp;P 500 displayed false breakouts.</li>
<li>Market dynamics have continued to deteriorate to the point where we don't see it as a buying opportunity, and we believe $115 support is not likely to hold on ACWI-US.</li>
<li>Therefore, we are cautious and would get defensive, as we believe the odds of a more prolonged downturn in global equities are rising.</li>
</ul>


We have been expecting near-term downside on ACWI-US and the S&amp;P 500 since our February 27 Int’l Compass, when both ACWI-US and the S&amp;P 500 displayed false breakouts.
Market dynamics have continued to deteriorate to the point where we don't see it as a buying opportunity, and we believe $115 support is not likely to hold on ACWI-US.
Therefore, we are cautious and would get defensive, as we believe the odds of a more prolonged downturn in global equities are rising.


Odds of a Prolonged Downturn Are Rising; We Are Cautious; Get Defensive

<ul>
<li>The September 2026 index review results for the ES50 index were announced yesterday after market close.</li>
<li>There will be two ADDs and two DELs for the index. This is in line with our expectations.</li>
<li>The Inclusion/Exclusion events will take place at the close of trading on Friday 18 September 2026. We see US$5bn+ in one-way flow.</li>
</ul>


The September 2026 index review results for the ES50 index were announced yesterday after market close.
There will be two ADDs and two DELs for the index. This is in line with our expectations.
The Inclusion/Exclusion events will take place at the close of trading on Friday 18 September 2026. We see US$5bn+ in one-way flow.


Quiddity ES50 Sep26 Results: All Expected ADDs/DELs Correct; Engie + Nokia IN; VWagen + Wolters OUT

Germany

E.ON is one of Europe's largest operators of energy networks and energy infrastructure and a provider of innovative customer solutions for some 51 million customers. The company's operations are energy networks and customer solutions.

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E.ON (EOAN GR)

Quiddity Leaderboard ES50 Sep27: No Changes Likely; Sector Test Holding Big Names Back

We see potential ADD RWE GR close to the border for September 2027, but many things could shake up the rankings between now and the base date at...

Afridi Reyal

Still Bearish/Cautious; Stick With Defensives; Emerging Market Opportunities

Still Bearish/Cautious; Stick With Defensives; Emerging Market Opportunities. Looking for the $ACWI rally to fizzle, either here at $113.50-$115 or...

Vermilion Research

Still Favor Defensives Until Market Dynamics Improve; EURO STOXX 50 Testing Crucial 5000 Level

Still Favor Defensives Until Market Dynamics Improve; EURO $STOXX 50 Testing Crucial 5000 Level; Watch for Resistance at $105-$117.69 on $ACWI. Buy...

Vermilion Research

Odds of a Prolonged Downturn Are Rising; We Are Cautious; Get Defensive

Odds of a Prolonged Downturn are Rising; We are Cautious; Get Defensive; $115 on ACWI-US Remains Key Level, and is at Risk of Breakdown. Actionable...

Vermilion Research

Quiddity ES50 Sep26 Results: All Expected ADDs/DELs Correct; Engie + Nokia IN; VWagen + Wolters OUT

The ES50 will see two BIG ADDs and two normal DELs in its annual review in September 2026. We expect a one-way flow of US$5bn+ driven mostly by...

Afridi Reyal

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