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

<ul>
<li>We discussed in last week's June 19 report how bullish price and RS trends on Israel's TA-125 was our tell that global equities were looking past Israel-Iran tensions.</li>
<li>Now completely in the rear-view mirror.  We also discussed how we were expecting short-term support on ACWI-US at $123-$123.50 (6.5-month base support), and ACWI-US bottomed at $123.20 on Monday.</li>
<li>As a result, we remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass).</li>
</ul>


We discussed in last week's June 19 report how bullish price and RS trends on Israel's TA-125 was our tell that global equities were looking past Israel-Iran tensions.
Now completely in the rear-view mirror.  We also discussed how we were expecting short-term support on ACWI-US at $123-$123.50 (6.5-month base support), and ACWI-US bottomed at $123.20 on Monday.
As a result, we remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass).


Downgrading Germany and Ireland; Global Technology Still Leading; Crucial Base Supports Holding

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>Following the results of <a href="https://www.smartkarma.com/entities/nippon-telegraph-telephone-corporation" target="_blank" data-smartkarma-citation="entities:623:1" rel="noopener">NTT (9432 JP)</a>'s tender offer for <a href="https://www.smartkarma.com/entities/ntt-data-corp" target="_blank" data-smartkarma-citation="entities:11232:1" rel="noopener">NTT Data Corp (9613 JP)</a>, NTT Data will be deleted from the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 (NKY INDEX)</a>.</li>
<li>
<a href="https://www.smartkarma.com/entities/rohm-co-ltd" target="_blank" data-smartkarma-citation="entities:2953:1" rel="noopener">ROHM Co Ltd (6963 JP)</a> will be added to the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 (NKY INDEX)</a> at the close on 3 July. The stock is up a fair bit from its lows.</li>
<li>Nearly all the <a href="https://www.smartkarma.com/entities/ntt-data-corp" target="_blank" data-smartkarma-citation="entities:11232:1" rel="noopener">NTT Data Corp</a> shares not tendered will be held by passives and there will be selling in the stock as index providers move the float lower/delete.</li>
</ul>


Following the results of NTT (9432 JP)'s tender offer for NTT Data Corp (9613 JP), NTT Data will be deleted from the Nikkei 225 (NKY INDEX).

ROHM Co Ltd (6963 JP) will be added to the Nikkei 225 (NKY INDEX) at the close on 3 July. The stock is up a fair bit from its lows.
Nearly all the NTT Data Corp shares not tendered will be held by passives and there will be selling in the stock as index providers move the float lower/delete.


Nikkei 225 Index Rebalance: Rohm (6963) To Replace NTT Data Group (9613)

Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>Masayoshi Son is floating a $1trn AI factory in Arizona in exchange for tax breaks.</li>
<li>NTT Data out, Rohm in. Downside for Ibiden, but also small buying for Fasty, Terumo, Konami and others.</li>
<li>Renesas announces details of its Wolfspeed restructuring deal which includes kitchen sinking the losses this year.</li>
</ul>


Masayoshi Son is floating a $1trn AI factory in Arizona in exchange for tax breaks.
NTT Data out, Rohm in. Downside for Ibiden, but also small buying for Fasty, Terumo, Konami and others.
Renesas announces details of its Wolfspeed restructuring deal which includes kitchen sinking the losses this year.


Japan Morning Connection: US Directly Attacks Iran and Requests Japan to Spend 5% of GDP on Defense

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>Today the results of the <a href="https://www.smartkarma.com/entities/ntt-data-corp" target="_blank" data-smartkarma-citation="entities:11232:1" rel="noopener">NTT Data Corp (9613 JP)</a> Tender Offer came out. NTT has 81.75%. I warned of lack of liquidity at that level yesterday <a href="https://www.smartkarma.com/insights/japan-event-potentially-interesting-dynamics-of-post-tender-ntt-data-9613-trading-8bn-one-way" target="_blank" rel="noopener">here</a>. </li>
<li>Yesterday I proposed that <a href="https://www.smartkarma.com/entities/rohm-co-ltd" target="_blank" data-smartkarma-citation="entities:2953:1" rel="noopener">ROHM Co Ltd (6963 JP)</a> would replace NTT Data in the Nikkei 225 and that the likely timing was the last couple of days of August.</li>
<li>Today, the Nikkei used the June 2020 rule change to announce NTT Data's near-term deletion. Rohm goes in 3 July. 7.5x ADV to buy. $3.8bn a side to trade.</li>
</ul>


Today the results of the NTT Data Corp (9613 JP) Tender Offer came out. NTT has 81.75%. I warned of lack of liquidity at that level yesterday here. 
Yesterday I proposed that ROHM Co Ltd (6963 JP) would replace NTT Data in the Nikkei 225 and that the likely timing was the last couple of days of August.
Today, the Nikkei used the June 2020 rule change to announce NTT Data's near-term deletion. Rohm goes in 3 July. 7.5x ADV to buy. $3.8bn a side to trade.


[Quiddity Index] Nikkei 225 Boots NTT Data (9613) Early, Rohm (6963) IN 3 July; $3.8bn a Side

<ul>
<li>We remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass).</li>
<li>We will maintain our bullish view as long as market dynamics remain healthy and the SPX and ACWI-US are above 5700-5785 and $119-$121.</li>
<li>$123-$123.50 remains short-term support to watch on ACWI-US (6.5-month base); we would expect support here on a pullback, but a break below it would likely mean a test of $119-$121</li>
</ul>


We remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass).
We will maintain our bullish view as long as market dynamics remain healthy and the SPX and ACWI-US are above 5700-5785 and $119-$121.
$123-$123.50 remains short-term support to watch on ACWI-US (6.5-month base); we would expect support here on a pullback, but a break below it would likely mean a test of $119-$121


Israel TA-125 Remains Bullish; Buys in Norway; All MSCI Global Indexes Above Base Supports

Japan

IBIDEN CO, LTD. develops, produces, and markets ceramics, housing materials, and electronics.  The Company's products include printed circuit boards (PCB), graphite specialties, integrated circuit (IC) packages, ceramic fibers, melamine decorative high-pressure laminates, and pre-cut structural materials.

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Ibiden Co Ltd (4062 JP)

Downgrading Germany and Ireland; Global Technology Still Leading; Crucial Base Supports Holding

Downgrading Germany and Ireland; Global Technology Still Leading; Crucial Base Supports Holding on $ACWI ($123-123.50), $EEM ($46)

Vermilion Research

Nikkei 225 Index Rebalance: Rohm (6963) To Replace NTT Data Group (9613)

Rohm has outperformed its peers by 4.4% since the announcement of NKY inclusion. Day 1 outperformance was 7.5% and part of those gains were given...

Brian Freitas

Japan Morning Connection: US Directly Attacks Iran and Requests Japan to Spend 5% of GDP on Defense

Defense related should be supported by reports on GDP defense spending along with Trump's move to directly bomb Iranian nuclear sites. Masayoshi...

Andrew Jackson

[Quiddity Index] Nikkei 225 Boots NTT Data (9613) Early, Rohm (6963) IN 3 July; $3.8bn a Side

The Nikkei has used June 2020 rule change language to boot NTT Data earlier than expected. It makes sense. Expect this is new precedent. Rohm is...

Travis Lundy

Israel TA-125 Remains Bullish; Buys in Norway; All MSCI Global Indexes Above Base Supports

Israel TA-125 Remains Bullish; Buys in Norway; All MSCI Global Indexes Above Base Supports $ACWI, $ACWX, ACWI ex-US Small-Caps, $EEM, and $EFA....

Vermilion Research

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