Silver Point

Thomas J. Monaco

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Equity Bottom-Up

* Deutsche Bank USA Fails CCAR and Capital Infusion Likely Necessary;* Several Other Banks Passed Conditionally; and *  Deutsche’s  CDS spreads are significantly wider; the belated S&amp;P downgrade continues to suggest that Deutsche is far from being out of the woods;  and  the HNA Group and Qatari Share Dumps To Continue. <h2>Investment Summary</h2>All but one of the 35 commercial banks have passed the Federal Reserve Board's Comprehensive Capital Analysis and Review (CCAR) stress test inclusive of…

* Deutsche Bank USA Fails CCAR and Capital Infusion Likely Necessary;* Several Other Banks Passed Conditionally; and *  Deutsche’s  CDS spreads are significantly wider; the belated S&amp;P downgrade continues to suggest that Deutsche is far from being out of the woods;  and  the HNA Group and Qatari Share Dumps To Continue. Investment SummaryAll but one of the 35 commercial banks have passed the Federal Reserve Board's Comprehensive Capital Analysis and Review (CCAR) stress test inclusive of…

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

So far the S&amp;P 500 has failed to overcome the 2,790-2,800 resistance level we first highlighted in our 6/5/18 Compass. However, while a breakdown below support remains possible, the S&amp;P 500 is currently at an area where we would expect to see some support. The wild card remains financials.  A breakdown of the sector has the potential to usher in another broad market selloff, which could cause the S&amp;P 500 to fall below 200-day moving average support and lead to more negative breadth signals for the indicators highlighted above. $26.50 on the XLF is the level we are watching.

So far the S&amp;P 500 has failed to overcome the 2,790-2,800 resistance level we first highlighted in our 6/5/18 Compass. However, while a breakdown below support remains possible, the S&amp;P 500 is currently at an area where we would expect to see some support. The wild card remains financials.  A breakdown of the sector has the potential to usher in another broad market selloff, which could cause the S&amp;P 500 to fall below 200-day moving average support and lead to more negative breadth signals for the indicators highlighted above. $26.50 on the XLF is the level we are watching.

U.S. Equities: Downgrading Manufacturing and Materials; Large-Cap Financials at Critical Support

* Well Written Plan, Does Not Suggest Its Viable:  Strategic priorities are similar to those of the previous 3 year Strategic Plan: a) continue the pivot toward Asia; b) focus on the international network; c) turn around the US business; and d) invest for future growth.* New Plan Does Not Add Up: That said, the updated strategic plan is confusing and very simply does not add up – especially considering that HSBC will be limiting loan growth to 1-2% per annum. The greater than 6% RoTE target for…

* Well Written Plan, Does Not Suggest Its Viable:  Strategic priorities are similar to those of the previous 3 year Strategic Plan: a) continue the pivot toward Asia; b) focus on the international network; c) turn around the US business; and d) invest for future growth.* New Plan Does Not Add Up: That said, the updated strategic plan is confusing and very simply does not add up – especially considering that HSBC will be limiting loan growth to 1-2% per annum. The greater than 6% RoTE target for…

HSBC Holdings Plc– New Strategic Plan Is Complete Nonsense

*5.5% HNA Group stake Being Liquidated. * 6.1% Qatar Stake Likely Next to Be Liquidated.  <h2>Investment Summary</h2>HNA Group (HNA) [private] in mainland China has been aggressively reducing its Deutsche Bank (DBK.GY/DB.US) [Deutsche] stake since the beginning of 2018 due to its own short-term financing needs. At the end of the day, we would not be shocked to see HNA (5.5% stake today vs. 9.1% at the peak) to completely liquidate its entire Deutsche position.Much more concerning, however, are press…

*5.5% HNA Group stake Being Liquidated. * 6.1% Qatar Stake Likely Next to Be Liquidated.  Investment SummaryHNA Group (HNA) [private] in mainland China has been aggressively reducing its Deutsche Bank (DBK.GY/DB.US) [Deutsche] stake since the beginning of 2018 due to its own short-term financing needs. At the end of the day, we would not be shocked to see HNA (5.5% stake today vs. 9.1% at the peak) to completely liquidate its entire Deutsche position.Much more concerning, however, are press…

* Questionable Restructuring Plan: Deutsche Bank (DBK.GY/DB.NY) [Deutsche] announced a dramatic restructuring plan with targets which are likely too optimistic.* A US Problem Institution: The FDIC – following the Federal Reserve’s lead from a year ago – placed Deutsche US on problem institution status, citing operational weakness.* S&amp;P Downgrade:  Deutsche’s shares now trading in the single digits and CDS spreads are significantly wider. The belated S&amp;P downgrade continues to suggest that…

* Questionable Restructuring Plan: Deutsche Bank (DBK.GY/DB.NY) [Deutsche] announced a dramatic restructuring plan with targets which are likely too optimistic.* A US Problem Institution: The FDIC – following the Federal Reserve’s lead from a year ago – placed Deutsche US on problem institution status, citing operational weakness.* S&amp;P Downgrade:  Deutsche’s shares now trading in the single digits and CDS spreads are significantly wider. The belated S&amp;P downgrade continues to suggest that…

United States

Citigroup Inc. is a diversified financial services holding company that provides a broad range of financial services to consumer and corporate customers. The Company services include investment banking, retail brokerage, corporate banking, and cash management products and services. Citigroup serves customers globally.

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Citigroup Inc (C US)

Deutsche Bank - Failed CCAR

* Deutsche Bank USA Fails CCAR and Capital Infusion Likely Necessary;* Several Other Banks Passed Conditionally; and * Deutsche’s CDS spreads are...

Thomas J. Monaco

U.S. Equities: Downgrading Manufacturing and Materials; Large-Cap Financials at Critical Support

So far the S&P 500 has failed to overcome the 2,790-2,800 resistance level we first highlighted in our 6/5/18 Compass. However, while a...

Vermilion Research

HSBC Holdings Plc– New Strategic Plan Is Complete Nonsense

* Well Written Plan, Does Not Suggest Its Viable: Strategic priorities are similar to those of the previous 3 year Strategic Plan: a) continue the...

Thomas J. Monaco

Deutsche Bank – Puke

5.5% HNA Group stake Being Liquidated. 6.1% Qatar Stake Likely Next to Be Liquidated. Investment SummaryHNA Group (HNA) [private] in mainland...

Thomas J. Monaco

Deutsche Bank - Good Night Moon

* Questionable Restructuring Plan: Deutsche Bank (DBK.GY/DB.NY) [Deutsche] announced a dramatic restructuring plan with targets which are likely...

Thomas J. Monaco

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Deutsche Bank - Failed CCAR

* Deutsche Bank USA Fails CCAR and Capital Infusion Likely Necessary;* Several Other Banks Passed Conditionally; and * Deutsche’s CDS spreads are...

Thomas J. Monaco

U.S. Equities: Downgrading Manufacturing and Materials; Large-Cap Financials at Critical Support

So far the S&P 500 has failed to overcome the 2,790-2,800 resistance level we first highlighted in our 6/5/18 Compass. However, while a...

Vermilion Research

HSBC Holdings Plc– New Strategic Plan Is Complete Nonsense

* Well Written Plan, Does Not Suggest Its Viable: Strategic priorities are similar to those of the previous 3 year Strategic Plan: a) continue the...

Thomas J. Monaco

Deutsche Bank – Puke

*5.5% HNA Group stake Being Liquidated. * 6.1% Qatar Stake Likely Next to Be Liquidated. Investment SummaryHNA Group (HNA) [private] in mainland...

Thomas J. Monaco

Deutsche Bank - Good Night Moon

* Questionable Restructuring Plan: Deutsche Bank (DBK.GY/DB.NY) [Deutsche] announced a dramatic restructuring plan with targets which are likely...

Thomas J. Monaco

5.5% HNA Group stake Being Liquidated. 6.1% Qatar Stake Likely Next to Be Liquidated. Investment SummaryHNA Group (HNA) [private] in mainland...