Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Equity Bottom-Up

TSMC (Taiwan Semiconductor Manufacturing) - ADR / Equity Bottom-Up

TSMC (Taiwan Semiconductor Manufacturing) - ADR

<ul>
<li>Hon Hai reports start of production for electric tractors in the U.S., and separately its founder is seeking the support of Taiwan's KMT party to run for Taiwan president.</li>
<li>The extreme Delta Thailand vs. Delta Taiwan valuation disconnect has finally reverted hard; Delta Thailand shares have crashed recently relative to Delta Taiwan not trading.</li>
<li>The long holiday has opened up some rare ADR discounts for Taiwan dual-listed names.</li>
</ul>


Hon Hai reports start of production for electric tractors in the U.S., and separately its founder is seeking the support of Taiwan's KMT party to run for Taiwan president.
The extreme Delta Thailand vs. Delta Taiwan valuation disconnect has finally reverted hard; Delta Thailand shares have crashed recently relative to Delta Taiwan not trading.
The long holiday has opened up some rare ADR discounts for Taiwan dual-listed names.


Taiwan Tech Weekly: Market Re-Opens After Long Holiday; U.S.-China Chip War Heats Up Further

Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>OVERSEAS. Strong close to SPX on Friday +1.4% on the Day; 3.5%WoW; +7.0%QTD; Light Macro calender this week with Job report Key; OPEC+ surprise cut; Tesla Misses 1Q</li>
<li>JAPAN.  NKY Fut +0.7% vs Cash; USDJPY 132.9; At the start of the new fiscal year, strong tailwinds ahead for Japan: BOJ normalization; Shareholder AGMs; Shareholder returns improvements; Bullish !</li>
<li>NUGGET. Labor Mobility Needed for Sustainable Wage Growth in Japan. This is essential to extend the gains made this year, or we risk reverting to the status quo. </li>
</ul>


OVERSEAS. Strong close to SPX on Friday +1.4% on the Day; 3.5%WoW; +7.0%QTD; Light Macro calender this week with Job report Key; OPEC+ surprise cut; Tesla Misses 1Q
JAPAN.  NKY Fut +0.7% vs Cash; USDJPY 132.9; At the start of the new fiscal year, strong tailwinds ahead for Japan: BOJ normalization; Shareholder AGMs; Shareholder returns improvements; Bullish !
NUGGET. Labor Mobility Needed for Sustainable Wage Growth in Japan. This is essential to extend the gains made this year, or we risk reverting to the status quo. 


Good Morning Japan |SPX-Sizzling 1Q Close; NUGGET: Labor Mobility Needed for Sustainable Wage Growth

<ul>
<li>OVERSEAS. SPX reclaims 4000 level to cose up +1.4%; Nasdaq 100 enters BULL MARKET;  Micron +7% Intel +7.6%  spurs sentiment around Semi recovery. </li>
<li>JAPAN. NKY Futs -0.3% vs Cash; USDJPY ¥132.8;  Dividend x-Date today - expect ~¥1trill of reinvestment BUYING in total; New Toyota CEO vows to get serious about EVs -about time</li>
<li>NUGGET. Incoming CEO Makiko Ono - Set to Further Globalize Suntory Beverage.  If she can execute, stock looks like a bargain. </li>
</ul>


OVERSEAS. SPX reclaims 4000 level to cose up +1.4%; Nasdaq 100 enters BULL MARKET;  Micron +7% Intel +7.6%  spurs sentiment around Semi recovery. 
JAPAN. NKY Futs -0.3% vs Cash; USDJPY ¥132.8;  Dividend x-Date today - expect ~¥1trill of reinvestment BUYING in total; New Toyota CEO vows to get serious about EVs -about time
NUGGET. Incoming CEO Makiko Ono - Set to Further Globalize Suntory Beverage.  If she can execute, stock looks like a bargain. 


Good Morning Japan |NASDAQ BULL MARKET! NUGGET: CEO Makiko Ono-Set to Further Globalize Suntory Bev

<ul>
<li>OVERSEAS.  Choppy Session with SPX closing -0.2%;  Tech down again as reversal continues;  US 2Yr yield back above 4%, Alibaba +14% split to unlock value; Micron after hours-worst over?</li>
<li>JAPAN. NKY Futs -1.0% vs Cash; USDJPY 130.9; US-Japan strikes deal on EV battery materials Under IRA; Japan's FTA fine with MSFT-ATVI, -ve Sony; Alibaba Split +ve Softbank</li>
<li>NUGGET. Panasonic - Potential beneficiary of new IRA related deal with the US. Could see IRA EV tax credit rise from ¥172bn/year to ¥228bn/year.</li>
</ul>


OVERSEAS.  Choppy Session with SPX closing -0.2%;  Tech down again as reversal continues;  US 2Yr yield back above 4%, Alibaba +14% split to unlock value; Micron after hours-worst over?
JAPAN. NKY Futs -1.0% vs Cash; USDJPY 130.9; US-Japan strikes deal on EV battery materials Under IRA; Japan's FTA fine with MSFT-ATVI, -ve Sony; Alibaba Split +ve Softbank
NUGGET. Panasonic - Potential beneficiary of new IRA related deal with the US. Could see IRA EV tax credit rise from ¥172bn/year to ¥228bn/year.


Good Morning Japan |Choppy Equities; Weak Tech; NUGGET: Panasonic-New US Tax Credit Opportunity?

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>
<a href="https://www.smartkarma.com/entities/oriental-land-co-ltd" target="_blank" data-smartkarma-citation="entities:13517:1" rel="noopener">Oriental Land (4661 JP)</a>, <a href="https://www.smartkarma.com/entities/renesas-electronics-corp" target="_blank" data-smartkarma-citation="entities:15933:1" rel="noopener">Renesas Electronics (6723 JP)</a>, <a href="https://www.smartkarma.com/entities/japan-airlines-co-ltd" target="_blank" data-smartkarma-citation="entities:1184:1" rel="noopener">Japan Airlines (9201 JP)</a> will replace <a href="https://www.smartkarma.com/entities/toyobo-co-ltd" target="_blank" data-smartkarma-citation="entities:6187:1" rel="noopener">Toyobo (3101 JP)</a>, <a href="https://www.smartkarma.com/entities/nippon-light-metal-holdings" target="_blank" data-smartkarma-citation="entities:1485:1" rel="noopener">Nippon Light Metal (5703 JP)</a>, <a href="https://www.smartkarma.com/entities/toho-zinc-co-ltd" target="_blank" data-smartkarma-citation="entities:2796:1" rel="noopener">Toho Zinc (5707 JP)</a> in the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225</a>.</li>
<li>Estimated one-way turnover at the rebalance is 1.08% and will result in a round-trip trade of JPY 412.8bn (US$3.16bn) at the close on 31 March.</li>
<li>There has been recent pre-positioning on the stocks as well as movement in short interest over the last couple of months.</li>
</ul>



Oriental Land (4661 JP), Renesas Electronics (6723 JP), Japan Airlines (9201 JP) will replace Toyobo (3101 JP), Nippon Light Metal (5703 JP), Toho Zinc (5707 JP) in the Nikkei 225.
Estimated one-way turnover at the rebalance is 1.08% and will result in a round-trip trade of JPY 412.8bn (US$3.16bn) at the close on 31 March.
There has been recent pre-positioning on the stocks as well as movement in short interest over the last couple of months.


Nikkei 225 Index Rebalance: Passives Trade on Friday

Japan

Tokyo Electron Limited manufactures and sells industrial electronics products, such as semiconductor manufacturing machines, computer system, and electronic components.  The Company products are sold in US, Taiwan, and others as well as in Japan.

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Tokyo Electron (8035 JP)

Taiwan Tech Weekly: Market Re-Opens After Long Holiday; U.S.-China Chip War Heats Up Further

Hon Hai reports start of production for electric tractors in the U.S., and separately its founder is seeking the support of Taiwan's KMT party to...

Vincent Fernando, CFA

Good Morning Japan |SPX-Sizzling 1Q Close; NUGGET: Labor Mobility Needed for Sustainable Wage Growth

US equities close out a solid quarter. For Japan, at the start of the new fiscal year, strong tailwinds ahead: BOJ normalization; Shareholder AGMs;...

Mark Chadwick

Good Morning Japan |NASDAQ BULL MARKET! NUGGET: CEO Makiko Ono-Set to Further Globalize Suntory Bev

In the US, NASDAQ 100 enters bull market. Broad based US rally. In Japan, Tech to lead; Drivers today: US rally, weaker yen; Underweight investors...

Mark Chadwick

Good Morning Japan |Choppy Equities; Weak Tech; NUGGET: Panasonic-New US Tax Credit Opportunity?

US Markets Choppy; Tech down again; Japan set to approve 114trill budget; US-Japan strikes deal on EV battery materials Under IRA; Japan's FTA fine...

Mark Chadwick

Nikkei 225 Index Rebalance: Passives Trade on Friday

Oriental Land, Renesas, JAL replace Toyobo, Nippon Light Metal, Toho Zinc. Estimated one-way turnover at the rebalance is 1.08% resulting in a...

Brian Freitas

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