Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>Echoes of August with Japan looking to start the day very weak on the lead from US semi related.</li>
<li>Expect heavy selling for recent retail margin favourites e.g. Mercari, IHI, KHI and Socionext, and SPE winners such as Kokusai and Advantest, although the sector will start under heavy pressure.</li>
<li>Nothing from Nikkei Inc. yet on their NKY225 rebalance decision, but expect outsized volatility today with many multi-strategy pods shuttered during the August sell off.</li>
</ul>


Echoes of August with Japan looking to start the day very weak on the lead from US semi related.
Expect heavy selling for recent retail margin favourites e.g. Mercari, IHI, KHI and Socionext, and SPE winners such as Kokusai and Advantest, although the sector will start under heavy pressure.
Nothing from Nikkei Inc. yet on their NKY225 rebalance decision, but expect outsized volatility today with many multi-strategy pods shuttered during the August sell off.


Japan Morning Connection: Expect Volatility with Retail and SPE Stocks Under Pressure

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Cross Asset Strategy

<ul>
<li>Japan's markets have again failed to break to new highs creating a potential for a double-top pattern.</li>
<li>Trump's policies which target lower interest rates and a weaker dollar will put pressure on Japan's markets as can be seen from the high correlation between the JPY and TPX.</li>
<li>Sectors such as trading companies, autos and semiconductors could see the most pressure under a Trump presidency.</li>
</ul>


Japan's markets have again failed to break to new highs creating a potential for a double-top pattern.
Trump's policies which target lower interest rates and a weaker dollar will put pressure on Japan's markets as can be seen from the high correlation between the JPY and TPX.
Sectors such as trading companies, autos and semiconductors could see the most pressure under a Trump presidency.


Trump Trades and the JAPAN Market Are Like Oil and Vinegar

<ul>
<li>More tech weakness in the US but most names off their lows, with Japan futures pointing to a recovery</li>
<li>Big margin calls yesterday at Japanese retail brokers may see continued forced selling in the most crowded names.</li>
<li>A quick glance at names with upside catalysts/strong fundamental drivers which should have room to run on an overall market recovery.</li>
</ul>


More tech weakness in the US but most names off their lows, with Japan futures pointing to a recovery
Big margin calls yesterday at Japanese retail brokers may see continued forced selling in the most crowded names.
A quick glance at names with upside catalysts/strong fundamental drivers which should have room to run on an overall market recovery.


Japan Morning Connection: 7453 JP, 4307 JP, 6857 JP

<ul>
<li>Meta and MSFT commented they are seeing benefits from their AI investments, pointing to increased capex positive for JP SPE names.</li>
<li>Advantest upgrading its tester market outlook for both SoC and memory over a solid 1Q earnings print will be positive for 6871 Micronics ahead of numbers.</li>
<li>Japan off the China export ban for now, however the US is unlikely to rollover and allow China unfettered access to cutting edge tech.</li>
</ul>


Meta and MSFT commented they are seeing benefits from their AI investments, pointing to increased capex positive for JP SPE names.
Advantest upgrading its tester market outlook for both SoC and memory over a solid 1Q earnings print will be positive for 6871 Micronics ahead of numbers.
Japan off the China export ban for now, however the US is unlikely to rollover and allow China unfettered access to cutting edge tech.


Japan Morning Connection - 6857 JP, 6871 JP, 6525 JP

<ul>
<li>DOW +0.59%, Russell -1.06%, SPX -1.39%, Nasdaq -2.77%, SOX -6.81% as investors shifted from growth to value stocks. UST10 was flat at 4.16%, and the yen strengthened to Y156.18.</li>
<li>Commodities were mixed with copper -0.3%, nickel -0.83%, and Brent +1.72%. Energy and consumer staples rose, with VSF +13.6% after Essilor Luxottica agreed to buy Supreme. US homebuilders lost ground. </li>
<li>Tech stocks fell sharply after ASML's earnings missed estimates and news of potential US export restrictions to China. Focus on SPE names with high China exposure as shorts.</li>
</ul>


DOW +0.59%, Russell -1.06%, SPX -1.39%, Nasdaq -2.77%, SOX -6.81% as investors shifted from growth to value stocks. UST10 was flat at 4.16%, and the yen strengthened to Y156.18.
Commodities were mixed with copper -0.3%, nickel -0.83%, and Brent +1.72%. Energy and consumer staples rose, with VSF +13.6% after Essilor Luxottica agreed to buy Supreme. US homebuilders lost ground. 
Tech stocks fell sharply after ASML's earnings missed estimates and news of potential US export restrictions to China. Focus on SPE names with high China exposure as shorts.


Japan Morning Connection – 18 July, 2024

Japan

ADVANTEST CORPORATION produces semiconductor testing devices and electronic measuring instruments.  The Company's products include large-scale integration (LSI) test systems, memory test systems, dynamic test handlers, network analyzers, electronic meters, optical testing devices, and signal sources.

Price Gauge
52-week Range	0.00 - 0.00
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Advantest Corp (6857 JP)

Japan Morning Connection: Expect Volatility with Retail and SPE Stocks Under Pressure

Japan's market set to open weak following US semi-related lead, heavy selling expected for retail margin favorites and SPE winners, potential...

Andrew Jackson

Trump Trades and the JAPAN Market Are Like Oil and Vinegar

We pointed out that Japan's semi industry may be at risk as part of the "Trump Trade" sentiment. It turns out that Biden has already thrown...

David Mudd

Japan Morning Connection: 7453 JP, 4307 JP, 6857 JP

US tech stocks showing weakness but on the rebound. Japanese market may see forced selling due to margin calls. Discussion of stocks with...

Andrew Jackson

Japan Morning Connection - 6857 JP, 6871 JP, 6525 JP

Meta and MSFT's AI gains boost capex and JP SPE names. Advantest's strong outlook aids Micronics. Japan lifts China export ban, but US likely to...

Andrew Jackson

Japan Morning Connection – 18 July, 2024

Investors shift from growth to value stocks, tech stocks fall on ASML earnings miss and US export restrictions to China, VSF surges after Essilor...

Andrew Jackson

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Japan Morning Connection: Expect Volatility with Retail and SPE Stocks Under Pressure

​Japan's market set to open weak following US semi-related lead, heavy selling expected for retail margin favorites and SPE winners, potential...

Andrew Jackson

Trump Trades and the JAPAN Market Are Like Oil and Vinegar

We pointed out that Japan's semi industry may be at risk as part of the "Trump Trade" sentiment. It turns out that Biden has already thrown...

David Mudd

Japan Morning Connection: 7453 JP, 4307 JP, 6857 JP

​US tech stocks showing weakness but on the rebound. Japanese market may see forced selling due to margin calls. Discussion of stocks with...

Andrew Jackson

Japan Morning Connection - 6857 JP, 6871 JP, 6525 JP

Meta and MSFT's AI gains boost capex and JP SPE names. Advantest's strong outlook aids Micronics. Japan lifts China export ban, but US likely to...

Andrew Jackson

Japan Morning Connection – 18 July, 2024

​Investors shift from growth to value stocks, tech stocks fall on ASML earnings miss and US export restrictions to China, VSF surges after Essilor...

Andrew Jackson

Japan's market set to open weak following US semi-related lead, heavy selling expected for retail margin favorites and SPE winners, potential...

US tech stocks showing weakness but on the rebound. Japanese market may see forced selling due to margin calls. Discussion of stocks with...

Investors shift from growth to value stocks, tech stocks fall on ASML earnings miss and US export restrictions to China, VSF surges after Essilor...