Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

<ul>
<li>In this insight, we take a look at the names leading the race to become ADDs/DELs for the STX Europe 600 and EUROSTX Indices for the March 2023 Rebalance.</li>
<li>STX Europe 600 members <a href="https://www.smartkarma.com/entities/credit-suisse-group-ag-f4b24f0c-c294-40b3-b491-759f0cb277e9" target="_blank" data-smartkarma-citation="entities:27915:1" rel="noopener">Credit Suisse (CSGN SW)</a> and <a href="https://www.smartkarma.com/entities/vantage-towers-ag" target="_blank" data-smartkarma-citation="entities:35602:1" rel="noopener">Vantage Towers (VTWR GR)</a> could possibly get deleted in the next few months triggering intra-review ADDs.</li>
<li>Separately, I see 3 more ADDs and DELs for the STX Europe 600 index in the regular review in June 2023.</li>
</ul>


In this insight, we take a look at the names leading the race to become ADDs/DELs for the STX Europe 600 and EUROSTX Indices for the March 2023 Rebalance.
STX Europe 600 members Credit Suisse (CSGN SW) and Vantage Towers (VTWR GR) could possibly get deleted in the next few months triggering intra-review ADDs.
Separately, I see 3 more ADDs and DELs for the STX Europe 600 index in the regular review in June 2023.


Quiddity Leaderboard SE600 Jun 23: Credit Suisse, Vantage Towers, and 3 Regular Changes

Head of Research, Krungthai XSpring

Waraporn Wiboonkanarak

Head of Research

A full service Thai brokerage

Krungthai XSpring

Krungthai XSpring is a full service broker. The company provides a wide range of investment services such as Securities Brokerage, Derivative Agent Business, Securities Borrowing and Lending, Securities Trading, Underwriting, Financial Advisory, Wealth Advisory, Private Fund Management and International Markets Securities Trading. 

In terms of credibility, Fitch Ratings has assigned Krunghtai XSpring a long-term rating of AA- and a national short-term rating of F1+ with stable outlook.

Equity Bottom-Up

<ul><li>The SET Index is expected to move sideways up, with the resistance at 1,585/1,600 points and the support at 1,570/1,560 points.</li><li>Meanwhile, the banking problems in the US and Europe have eased to some extent.</li><li>Regarding the FOMC meeting tonight, we share the market's view calling for the Fed to raise the fed funds rate by 0.25% to 4.75-5.00% and give more weight to the stability of the financial system than inflation.</li></ul>

The SET Index is expected to move sideways up, with the resistance at 1,585/1,600 points and the support at 1,570/1,560 points.Meanwhile, the banking problems in the US and Europe have eased to some extent.Regarding the FOMC meeting tonight, we share the market's view calling for the Fed to raise the fed funds rate by 0.25% to 4.75-5.00% and give more weight to the stability of the financial system than inflation.

Research and consultancy, Tabbush Report

Daniel Tabbush

Research and consultancy

Tabbush Report

We provide research and consultancy on Asian banks. Our focus is on what we call “Asian bank research, without the noise.” We are interested in the most critical swing-factors for banks, the NPL and credit cycle, and where we believe there is a gap between perception and reality. We often focus on the less studied components of bank financial statements.  Our research is highly thematic, sometimes examining unlisted banks and companies as a window on mainstream banks. 

Being independent allows us to look at smaller banks, often overlooked by others. Analysis of BIS bank guidelines in the context of Asia, is also a focal point, while we also analyze global banks operating in the region. We use what we believe is the most comprehensive, reliable financials database, SNL Financial. S&P Capital IQ augments our database, with corporate data and CEIC, with economics. 

Asian bank research, without the noise.

<ul>
<li>Funding squeeze evident in HK's HIBOR market and reported in Australia too</li>
<li>Even where not visible, this must be expected globally, as banks reign in risk</li>
<li>MQG has low levels of deposits and high levels of securities</li>
</ul>


Funding squeeze evident in HK's HIBOR market and reported in Australia too
Even where not visible, this must be expected globally, as banks reign in risk
MQG has low levels of deposits and high levels of securities


<ul><li>The SET Index is expected to move sideways up, with the resistance at 1,565/1,570 points and the support at 1,545/1,540 points, in response to the rebounds in US and European markets after major central banks announced they would collaborate to boost liquidity in the financial system.</li><li>In light of this, we suggest investing in high-dividend stocks with large upside to their fair values.</li><li>The factors that will determine the SET Index's direction in the near future include the following: i) the actual impact of the write-off of Credit Suisse's additional tier one (AT1) debt worth USD17.3bn to zero; and ii) the FOMC meeting on March 22, specifically the signals regarding the interest rate trend and further measures to stabilize the financial system.</li></ul>

The SET Index is expected to move sideways up, with the resistance at 1,565/1,570 points and the support at 1,545/1,540 points, in response to the rebounds in US and European markets after major central banks announced they would collaborate to boost liquidity in the financial system.In light of this, we suggest investing in high-dividend stocks with large upside to their fair values.The factors that will determine the SET Index's direction in the near future include the following: i) the actual impact of the write-off of Credit Suisse's additional tier one (AT1) debt worth USD17.3bn to zero; and ii) the FOMC meeting on March 22, specifically the signals regarding the interest rate trend and further measures to stabilize the financial system.

Markets Will Remain Highly Volatile Ahead of FOMC Meeting; Investors Are Suggested to Find Shelter in Defensive Stocks

<ul><li>US yield curves declined after problems emerged in the banking system, suggesting that the Fed will end its rate hikes sooner than expected</li><li>S&P 500 Index has a negative correlation with US 10Y bond yield (-70.00%)</li><li>The SET Index is expected to rebound, with the resistance at 1,565/1,575 points and the support at 1,543/1,535 points.</li></ul>

US yield curves declined after problems emerged in the banking system, suggesting that the Fed will end its rate hikes sooner than expectedS&P 500 Index has a negative correlation with US 10Y bond yield (-70.00%)The SET Index is expected to rebound, with the resistance at 1,565/1,575 points and the support at 1,543/1,535 points.

High Probability That the Fed Will Slow Down Rate Hikes Should Lift the SET

Switzerland

Credit Suisse Group AG is an international financial services group. The Group provides investment banking, private banking, and asset management services to customers located around the world.

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Credit Suisse (CSGN VX)

Quiddity Leaderboard SE600 Jun 23: Credit Suisse, Vantage Towers, and 3 Regular Changes

Currently, Gerresheimer AG (GXI GR) and Loomis AB (LOOMB SS) are the highest-ranked non-constituents and could be favourites to become intra-review...

Janaghan Jeyakumar, CFA

Today's Dominant Ideas

The SET Index is expected to move sideways up, with the resistance at 1,585/1,600 points and the support at 1,570/1,560 points. Meanwhile, the...

Krungthai XSpring

MQG - Funding Squeeze?

Funding squeeze is evident in Hong Kong, and reports suggest the same in Australia, with other markets likely. Banks which rely more on non-deposit...

Daniel Tabbush

Markets Will Remain Highly Volatile Ahead of FOMC Meeting; Investors Are Suggested to Find Shelter in Defensive Stocks

The SET Index is expected to move sideways up, with the resistance at 1,565/1,570 points and the support at 1,545/1,540 points, in response to the...

Krungthai XSpring

High Probability That the Fed Will Slow Down Rate Hikes Should Lift the SET

US yield curves declined after problems emerged in the banking system, suggesting that the Fed will end its rate hikes sooner than...

Krungthai XSpring

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