Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>Japanese equities advanced in a holiday-shortened week, buoyed by global risk-on sentiment and a weaker yen</li>
<li>Strangely, Services PMI rose to 52.4 in April, showing continued expansion with stronger new orders despite falling business confidence and other lead indicators</li>
<li>NTT Data Corp (9613 JP)  stock surged +41% this week following the announcement that parent company NTT will launch a tender offer to acquire all remaining shares</li>
</ul>


Japanese equities advanced in a holiday-shortened week, buoyed by global risk-on sentiment and a weaker yen
Strangely, Services PMI rose to 52.4 in April, showing continued expansion with stronger new orders despite falling business confidence and other lead indicators
NTT Data Corp (9613 JP)  stock surged +41% this week following the announcement that parent company NTT will launch a tender offer to acquire all remaining shares


Highly Differentiated Ideas and Insights, Made in Japan

Made in Japan

Highly Differentiated Ideas and Insights

The mission of MIJ is to become your field guide to Business and Investing in Japan. My goal is to make businesses in Japan more accessible to everyone by breaking down cultural barriers and provide differentiated ideas and insights.

<ul><li>It’s been no secret that Japan has not been the most technologically forward society in the world…</li><li>As a consumer, it was only a few years ago you’d be carrying hard cash to pay for most things as many shops wouldn’t let you pay with your card.</li><li>If you’re an employee, the chances are that your office is still using a fax in one capacity or another. </li></ul>

It’s been no secret that Japan has not been the most technologically forward society in the world…As a consumer, it was only a few years ago you’d be carrying hard cash to pay for most things as many shops wouldn’t let you pay with your card.If you’re an employee, the chances are that your office is still using a fax in one capacity or another. 

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>Our outlook remains bullish on global equities (MSCI ACWI) with ACWI-US and the S&amp;P 500 holding above their respective bases at $117 and 5650-5670.</li>
<li>We've discussed since mid-October how we would use any pre-election pullback in the MSCI ACWI or the SPX (U.S. remains our only country overweight) as an opportunity to add exposure</li>
<li>And we continue to see a high probability of significant upside going into year-end and the early part of 2025.</li>
</ul>


Our outlook remains bullish on global equities (MSCI ACWI) with ACWI-US and the S&amp;P 500 holding above their respective bases at $117 and 5650-5670.
We've discussed since mid-October how we would use any pre-election pullback in the MSCI ACWI or the SPX (U.S. remains our only country overweight) as an opportunity to add exposure
And we continue to see a high probability of significant upside going into year-end and the early part of 2025.


Buy the Pullback in MSCI ACWI and S&P 500; Buys in Uranium, Transports, Services, Technology, More

EURO STOXX 50 Price EUR / Technical Analysis

<ul>
<li>We continue to view the latest pullback as healthy and normal within the ongoing bull market on MSCI ACWI (ACWI-US) and the EURO STOXX 50, as discussed April 18</li>
<li>Discussed last Thursday(4/18/24) how further downside may be limited with these indexes 4-5% off their highs, combined with ACWI-US testing gap support ($105) and the EURO STOXX50 testing 6-month uptrend. </li>
<li>So far, these supports have held strong, and Japan's TOPIX has also held strong above 2615 support -- with all producing strong bounces far this week.</li>
</ul>


We continue to view the latest pullback as healthy and normal within the ongoing bull market on MSCI ACWI (ACWI-US) and the EURO STOXX 50, as discussed April 18
Discussed last Thursday(4/18/24) how further downside may be limited with these indexes 4-5% off their highs, combined with ACWI-US testing gap support ($105) and the EURO STOXX50 testing 6-month uptrend. 
So far, these supports have held strong, and Japan's TOPIX has also held strong above 2615 support -- with all producing strong bounces far this week.


Upgrading Europe to Overweight; Supports Holding on MSCI ACWI, ACWI Ex-US, EAFE, and EM

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/dentsu-soken-inc" target="_blank" data-smartkarma-citation="entities:20535:1" rel="noopener">Dentsu Soken (4812 JP)</a> announced a preconditional tender offer from <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a> at JPY2,880, a 35.0% premium to the undisturbed price but below Nikkei’s rumoured JPY250 billion valuation.</li>
<li>The precondition concerns approvals from Japan, China, and the EU. The offer is expected to commence in early November.</li>
<li>While the offer represents a pre-announcement all-time high, it is below the midpoint of the target IFA valuation range. However, activists face a formidable task to force a bump. </li>
</ul>



Dentsu Soken (4812 JP) announced a preconditional tender offer from Itochu Corp (8001 JP) at JPY2,880, a 35.0% premium to the undisturbed price but below Nikkei’s rumoured JPY250 billion valuation.
The precondition concerns approvals from Japan, China, and the EU. The offer is expected to commence in early November.
While the offer represents a pre-announcement all-time high, it is below the midpoint of the target IFA valuation range. However, activists face a formidable task to force a bump. 


Dentsu Soken (4812 JP): Itochu (8001 JP)’s Offer Deflates Expectations

Japan

NTT Data Corporation mainly provides large scale system integration and networking system services. System integration involves data transmission system design, sales, leasing, and services.  Network System Services include internet related and linked computer networks, and data provision and management of data. The Company is a subsidiary of Nippon Telegraph & Telephone Corporation.

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NTT Data Corp (9613 JP)

Japan Strategy Weekly | Tariff Relief

Japanese equities rose due to global risk-on sentiment and a weaker yen, Services PMI increased despite falling business confidence, and NTT Data...

Mark Chadwick

Why I think Japanese SaaS is undervalued

It’s been no secret that Japan has not been the most technologically forward society in the world…As a consumer, it was only a few years ago you’d...

Made in Japan

Buy the Pullback in MSCI ACWI and S&P 500; Buys in Uranium, Transports, Services, Technology, More

Buy the Pullback in MSCI $ACWI and $SPX; Still bullish on global equities with $ACWI and the SPX holding above their respective bases at $117 and...

Vermilion Research

Upgrading Europe to Overweight; Supports Holding on MSCI ACWI, ACWI Ex-US, EAFE, and EM

Upgrading Europe to Overweight EURO $STOXX 50 $FEZ; Supports Holding on MSCI $ACWI, $ACWX, $EFA, and $EEM. Latest 4-6% pullback remains healthy...

Vermilion Research

Dentsu Soken (4812 JP): Itochu (8001 JP)’s Offer Deflates Expectations

While the offer represents a pre-announcement all-time high, it is below the midpoint of the target IFA valuation range. However, activists face a...

Arun George

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Japan Strategy Weekly | Tariff Relief

​Japanese equities rose due to global risk-on sentiment and a weaker yen, Services PMI increased despite falling business confidence, and NTT Data...

Mark Chadwick

Why I think Japanese SaaS is undervalued

It’s been no secret that Japan has not been the most technologically forward society in the world…As a consumer, it was only a few years ago you’d...

Made in Japan

Buy the Pullback in MSCI ACWI and S&P 500; Buys in Uranium, Transports, Services, Technology, More

Buy the Pullback in MSCI $ACWI and $SPX; Still bullish on global equities with $ACWI and the SPX holding above their respective bases at $117 and...

Vermilion Research

Upgrading Europe to Overweight; Supports Holding on MSCI ACWI, ACWI Ex-US, EAFE, and EM

Upgrading Europe to Overweight EURO $STOXX 50 $FEZ; Supports Holding on MSCI $ACWI, $ACWX, $EFA, and $EEM. Latest 4-6% pullback remains healthy...

Vermilion Research

Dentsu Soken (4812 JP): Itochu (8001 JP)’s Offer Deflates Expectations

While the offer represents a pre-announcement all-time high, it is below the midpoint of the target IFA valuation range. However, activists face a...

Arun George

Japanese equities rose due to global risk-on sentiment and a weaker yen, Services PMI increased despite falling business confidence, and NTT Data...