Pan-Asia Tactical Market Calls (Quant-Driven), MRM Research

Nico Rosti

Pan-Asia Tactical Market Calls (Quant-Driven)

MRM Research

Quantitative Research

Event-Driven

<ul>
<li>All the APAC markets we cover (Nifty50, HSI, Nikkei225, Kospi200, S&amp;P/ASX200) are pulling back and some of them have been doing so for 3 weeks.</li>
<li>In this insight we want to offer a re-cap of all the MRM support levels and probabilities for the APAC markets above, after the August 16th Close.</li>
<li>Check our previously published single-market insights for deeper analysis and related investment ideas: <a href="https://www.smartkarma.com/insights/eqd-nifty-index-weekly-correction-may-be-ending" target="_blank" rel="noopener">Nifty50</a>, <a href="https://www.smartkarma.com/insights/eqd-hang-seng-index-hsi-weekly-long-support-levels-and-probability" target="_blank" rel="noopener">HSI</a>, <a href="https://www.smartkarma.com/insights/eqd-nikkei-225-nky-monthly-trajectories" target="_blank" rel="noopener">Nikkei225</a>, <a href="https://www.smartkarma.com/insights/eqd-kospi-200-index-weekly-trend-analysis" target="_blank" rel="noopener">Kospi200</a>, S&amp;P/ASX200.</li>
</ul>


All the APAC markets we cover (Nifty50, HSI, Nikkei225, Kospi200, S&amp;P/ASX200) are pulling back and some of them have been doing so for 3 weeks.
In this insight we want to offer a re-cap of all the MRM support levels and probabilities for the APAC markets above, after the August 16th Close.
Check our previously published single-market insights for deeper analysis and related investment ideas: Nifty50, HSI, Nikkei225, Kospi200, S&amp;P/ASX200.


APAC WEEKLY Monitor: Current MRM Supports and Probabilities Re-Cap

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/country-garden-services-holdings-company-limited" target="_blank" data-smartkarma-citation="entities:27343:1" rel="noopener">Country Garden Services Holdings (6098 HK)</a> and <a href="https://www.smartkarma.com/entities/zhongsheng-group-holdings" target="_blank" data-smartkarma-citation="entities:10573:1" rel="noopener">Zhongsheng Group (881 HK)</a> are high probability deletions in September, while <a href="https://www.smartkarma.com/entities/trip-com-group-ltd-23a341d0-4f63-4175-a8c5-ee990906cacd" target="_blank" data-smartkarma-citation="entities:36424:1" rel="noopener">Trip.com (9961 HK)</a> is a high probability inclusion.</li>
<li>The second add could be <a href="https://www.smartkarma.com/entities/beigene-ltd" target="_blank" data-smartkarma-citation="entities:27352:1" rel="noopener">BeiGene Ltd (6160 HK)</a> if it passes the velocity test. If not, <a href="https://www.smartkarma.com/entities/chow-tai-fook-jewellery-group" target="_blank" data-smartkarma-citation="entities:549:1" rel="noopener">Chow Tai Fook Jewellery (1929 HK)</a> will be added.</li>
<li>With the exception of <a href="https://www.smartkarma.com/entities/zhongsheng-group-holdings" target="_blank" data-smartkarma-citation="entities:10573:1" rel="noopener">Zhongsheng Group (881 HK)</a>, short interest has been rising on all the other stocks and could affect how the stocks trade close to implementation date.</li>
</ul>



Country Garden Services Holdings (6098 HK) and Zhongsheng Group (881 HK) are high probability deletions in September, while Trip.com (9961 HK) is a high probability inclusion.
The second add could be BeiGene Ltd (6160 HK) if it passes the velocity test. If not, Chow Tai Fook Jewellery (1929 HK) will be added.
With the exception of Zhongsheng Group (881 HK), short interest has been rising on all the other stocks and could affect how the stocks trade close to implementation date.


HSCEI Index Rebalance Preview: Deletions Fairly Certain; Uncertainty Among the Adds

Equity Derivatives

<ul>
<li>The 2023 multi-month rally in APAC markets started roughly in autumn 2022, in sync with the US market rally, then stalled when the US market began to pull back.</li>
<li>We propose an analysis of the S&amp;P500 MONTHLY, to find support levels to be used as a proxy for predicting APAC bloc's markets supports.</li>
<li>Main forecast: August/September could be down, but the current MRM pattern reading is bullish - the correction (currently at Q2 supports) should not last beyond end of September.</li>
</ul>


The 2023 multi-month rally in APAC markets started roughly in autumn 2022, in sync with the US market rally, then stalled when the US market began to pull back.
We propose an analysis of the S&amp;P500 MONTHLY, to find support levels to be used as a proxy for predicting APAC bloc's markets supports.
Main forecast: August/September could be down, but the current MRM pattern reading is bullish - the correction (currently at Q2 supports) should not last beyond end of September.


EQD | SPX MONTHLY Proxy Supports for APAC Markets

Head of Research and Global Chief Strategist, Steno Research

Andreas Steno

Head of Research and Global Chief Strategist

Macro and Geopolitical Research House

Steno Research

Steno Research is a new macro and geopolitical research house. We are based out of Copenhagen, Denmark, but have an international team and a strong network of sources and partners around the world. The team is lead by Andreas Steno, previous global head of strategy at Nordea Bank, and Mikkel Rosenvold, former chief consultant in the Danish Ministry of Finance.

Cross Asset Strategy

<ul>
<li>Hello everyone, and welcome to our China Week where we try to gather all forces to cover the ongoing economic situation in China, which is subject to substantial volatility and political turbulence currently.</li>
<li>In this piece, we will look at Chinese deflationary trends and whether they will spread to the West and/or elsewhere on the globe.</li>
<li>Through the Pandemic, China was “outprinted” / “outcredited” by the US, Europe and the UK for the first time in several decades.</li>
</ul>


Hello everyone, and welcome to our China Week where we try to gather all forces to cover the ongoing economic situation in China, which is subject to substantial volatility and political turbulence currently.
In this piece, we will look at Chinese deflationary trends and whether they will spread to the West and/or elsewhere on the globe.
Through the Pandemic, China was “outprinted” / “outcredited” by the US, Europe and the UK for the first time in several decades.


China Deflation Watch – What Happens in China Stays in China

<ul>
<li>We have spent this Sunday evening trying to prepare ourselves for the opening given the turmoil expected in China after Country Gardens (the former largest developer) is to suspend trading of at least 10 onshore bonds after a week where they failed to pay coupons of a couple of international payments.</li>
<li>The Hang Seng Property Index (HSP) is down 20% y-t-d but only lost 0.2% on Friday despite another landslide in the Country Garden stock.</li>
<li>If the HSP Index drops over the coming days, it ought to be taken as a signal that Chinese RE credit will decline further due to a lack of confidence in the financial system.</li>
</ul>


We have spent this Sunday evening trying to prepare ourselves for the opening given the turmoil expected in China after Country Gardens (the former largest developer) is to suspend trading of at least 10 onshore bonds after a week where they failed to pay coupons of a couple of international payments.
The Hang Seng Property Index (HSP) is down 20% y-t-d but only lost 0.2% on Friday despite another landslide in the Country Garden stock.
If the HSP Index drops over the coming days, it ought to be taken as a signal that Chinese RE credit will decline further due to a lack of confidence in the financial system.


Asset Allocation Watch: Country Garden Melt-Down? 5 Charts on Cross-Asset Spill-Overs!

Hong Kong

The Hang Seng Index is a free-float capitalization-weighted index of a selection of companies from the Stock Exchange of Hong Kong. The components of the index are divided into four subindices: Commerce and Industry, Finance, Utilities, and Properties. The index was developed with a base level of 100 as of July 31, 1964.

Hang Seng Index (HSI INDEX)

APAC WEEKLY Monitor: Current MRM Supports and Probabilities Re-Cap

A re-cap/monitor of all the MRM WEEKLY support levels and probabilities of trend reversal for the APAC markets we cover (Nifty50, HSI, Nikkei 225,...

Nico Rosti

HSCEI Index Rebalance Preview: Deletions Fairly Certain; Uncertainty Among the Adds

The two potential adds have outperformed the two potential deletes by 42% since end May and by 52% since end June. Shorts have jumped on Beigene...

Brian Freitas

EQD | SPX MONTHLY Proxy Supports for APAC Markets

We propose an analysis of the SP500 MONTHLY, to find MRM support levels to be used as a proxy to predict APAC markets MONTHLY supports.

Nico Rosti

China Deflation Watch – What Happens in China Stays in China

Hello everyone, and welcome to our China Week where we try to gather all forces to cover the ongoing economic situation in China, which is subject...

Steno Research

Asset Allocation Watch: Country Garden Melt-Down? 5 Charts on Cross-Asset Spill-Overs!

We have spent this Sunday evening trying to prepare ourselves for the opening given the turmoil expected in China after Country Gardens (the former...

Steno Research