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

<p>We continue to believe global equities (ACWI-US) are likely to test the recent low made on March 23, with an undercut of roughly 10% also in the cards. This expectation is supported by price action during prior major waterfall declines in past recessionary periods. With the global economy likely headed for a recession (or worse) we believe it is important to stay with the Sectors that have been outperforming amid the COVID-19 pandemic as we believe they are likely to continue outperforming. That means we are sticking primarily with Staples, Health Care, and Technology. We are also expanding our recommendations to include bottom-up ideas within several other Sectors.</p>

We continue to believe global equities (ACWI-US) are likely to test the recent low made on March 23, with an undercut of roughly 10% also in the cards. This expectation is supported by price action during prior major waterfall declines in past recessionary periods. With the global economy likely headed for a recession (or worse) we believe it is important to stay with the Sectors that have been outperforming amid the COVID-19 pandemic as we believe they are likely to continue outperforming. That means we are sticking primarily with Staples, Health Care, and Technology. We are also expanding our recommendations to include bottom-up ideas within several other Sectors.

Global Equities (ACWI-US) Likely to Retest the March Low

<p style="text-align: justify;">With the MSCI ACWI (ACWI-US) breaking below our $70 “line in the sand” support level we highlighted last week, we believe additional downside is likely and that the path of least resistance is lower for global equities. Considering the damage done to major indexes around the world, any potential bottom is likely to take months to develop and until we see evidence of this repair process we want to be positioned primarily in Sectors with defensive characteristics. Of course, there will be major <em>countertrend </em>rallies along the way, but for now the trend is lower and we would treat rallies as selling opportunities. We outline important technical levels across all markets and highlight actionable opportunities within EM, and the Services and Staples Sectors.</p>

With the MSCI ACWI (ACWI-US) breaking below our $70 “line in the sand” support level we highlighted last week, we believe additional downside is likely and that the path of least resistance is lower for global equities. Considering the damage done to major indexes around the world, any potential bottom is likely to take months to develop and until we see evidence of this repair process we want to be positioned primarily in Sectors with defensive characteristics. Of course, there will be major countertrend rallies along the way, but for now the trend is lower and we would treat rallies as selling opportunities. We outline important technical levels across all markets and highlight actionable opportunities within EM, and the Services and Staples Sectors.

ACWI Below Our Line In The Sand: Further Weakness Expected

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/jiumaojiu-international-holdings" target="_blank" data-smartkarma-citation="entities:28293:1" rel="noopener">Jiumaojiu (9922 HK)</a> is a Chinese restaurant chain operator which operates 328 outlets in China under five brands. Jiumaojiu will commence trading on Wednesday, 15 January. Jiumaojiu priced its IPO at HK$6.60 per share (at the top-end of the range). </p></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/jiumaojiu-international-ipo-valuation-reasonable-for-the-growth" target="_blank" rel="noopener">our valuation note</a>, we stated that the IPO price range is attractive in the context of Jiumaojiu's earnings growth potential. Our DCF analysis supports this view and our DCF-based scenario analysis suggests that the IPO price is undemanding.</p></div></div></div>

Jiumaojiu (9922 HK) is a Chinese restaurant chain operator which operates 328 outlets in China under five brands. Jiumaojiu will commence trading on Wednesday, 15 January. Jiumaojiu priced its IPO at HK$6.60 per share (at the top-end of the range). In our valuation note, we stated that the IPO price range is attractive in the context of Jiumaojiu's earnings growth potential. Our DCF analysis supports this view and our DCF-based scenario analysis suggests that the IPO price is undemanding.

Jiumaojiu: Trading Debut, Valuation Scenario Analysis

<p><a href="https://www.smartkarma.com/entities/jiumaojiu-international-holdings" target="_blank" data-smartkarma-citation="entities:28293:1" rel="noopener">Jiumaojiu (9922 HK)</a> is a Chinese restaurant chain operator which operates 328 outlets in China under five brands. Jiumaojiu will raise net proceeds of HK$1,910.6 million ($245 million) at the mid-point of the IPO price range. </p><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/jiumaojiu-international-ipo-initiation-eat-up" target="_blank" rel="noopener">our initiation note</a>, we stated that Jiumaojiu’s fundamentals offer more positives than negatives and could prove attractive at the right valuation. Our valuation analysis suggests that the IPO price range is attractive in the context of Jiumaojiu's earnings growth potential.</p></div></div></div>

Jiumaojiu (9922 HK) is a Chinese restaurant chain operator which operates 328 outlets in China under five brands. Jiumaojiu will raise net proceeds of HK$1,910.6 million ($245 million) at the mid-point of the IPO price range. In our initiation note, we stated that Jiumaojiu’s fundamentals offer more positives than negatives and could prove attractive at the right valuation. Our valuation analysis suggests that the IPO price range is attractive in the context of Jiumaojiu's earnings growth potential.

Jiumaojiu International IPO: Valuation Reasonable for the Growth

<p><a href="https://www.smartkarma.com/entities/jiumaojiu-international-holdings" target="_blank" data-smartkarma-citation="entities:28293:1" rel="noopener">Jiumaojiu (9922 HK)</a> is a Chinese restaurant chain operator which operates 328 outlets in China under five brands. Jiu Mao Jiu has launched a Hong Kong IPO to raise net proceeds of HK$1,734.5-2,086.6 million ($223-268 million).</p><div class="content-highlight"><p>Jiumaojiu is a play on the attractive growth of the Chinese cuisine market, which is underpinned by the increasing urbanisation rate, the growing importance of catering in shopping malls and prevalent dining out lifestyle in China. Overall, we believe that Jiumaojiu’s fundamentals offer more positives than negatives.</p></div>

Jiumaojiu (9922 HK) is a Chinese restaurant chain operator which operates 328 outlets in China under five brands. Jiu Mao Jiu has launched a Hong Kong IPO to raise net proceeds of HK$1,734.5-2,086.6 million ($223-268 million).Jiumaojiu is a play on the attractive growth of the Chinese cuisine market, which is underpinned by the increasing urbanisation rate, the growing importance of catering in shopping malls and prevalent dining out lifestyle in China. Overall, we believe that Jiumaojiu’s fundamentals offer more positives than negatives.

Jiumaojiu International IPO Initiation: Eat Up

China

Yihai International Holding Ltd. engages in the condiment industry. The Company produces hot pot seasonings and other sauce products. Yihai markets worldwide.

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Yihai Int’L Holding (1579 HK)

Global Equities (ACWI-US) Likely to Retest the March Low

We continue to believe global equities (ACWI-US) are likely to test the recent low made on March 23, with an undercut of roughly 10% also in the...

Vermilion Research

ACWI Below Our Line In The Sand: Further Weakness Expected

With the MSCI ACWI (ACWI-US) breaking below our $70 “line in the sand” support level we highlighted last week, we believe additional downside is...

Vermilion Research

Jiumaojiu: Trading Debut, Valuation Scenario Analysis

Jiumaojiu (9922 HK) is a Chinese restaurant chain operator which operates 328 outlets in China under five brands. Jiumaojiu will commence trading...

Arun George

Jiumaojiu International IPO: Valuation Reasonable for the Growth

Jiumaojiu (9922 HK) is a Chinese restaurant chain operator which operates 328 outlets in China under five brands. Jiumaojiu will raise net proceeds...

Arun George

Jiumaojiu International IPO Initiation: Eat Up

Jiumaojiu (9922 HK) is a Chinese restaurant chain operator which operates 328 outlets in China under five brands. Jiu Mao Jiu has launched a Hong...

Arun George

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