Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Cross Asset Strategy

<ul>
<li>Healthcare sector continues to gain momentum in Hong Kong market during pullback with materials and energy sectors lagging.</li>
<li>Value and Liquidity factors have outperformed since stimulus announcement in September.</li>
<li>
<a href="https://www.smartkarma.com/entities/anta-sports-products-ltd" target="_blank" data-smartkarma-citation="entities:10261:1" rel="noopener">Anta Sports Products (2020 HK)</a> , <a href="https://www.smartkarma.com/entities/jd-health-international-inc" target="_blank" data-smartkarma-citation="entities:29677:1" rel="noopener">JD Health International (6618 HK)</a> and <a href="https://www.smartkarma.com/entities/sands-china-ltd" target="_blank" data-smartkarma-citation="entities:182:1" rel="noopener">Sands China (1928 HK)</a> were rated as BUY as analysts turn toward China consumption plays as future winners.
</li>
</ul>


Healthcare sector continues to gain momentum in Hong Kong market during pullback with materials and energy sectors lagging.
Value and Liquidity factors have outperformed since stimulus announcement in September.

Anta Sports Products (2020 HK) , JD Health International (6618 HK) and Sands China (1928 HK) were rated as BUY as analysts turn toward China consumption plays as future winners.



BUY/SELL/HOLD: Hong Kong Stock Updates (October 15)

<ul>
<li>Hong Kong Dollar continues to trade at the strong end of its band  resulting in upward pressure on HIBOR in turn causing a further unwind of the HKD carry trade.</li>
<li>HSI shows the strongest market breadth in 15 years as nearly all members trade above 200 DMA.</li>
<li>
<a href="https://www.smartkarma.com/entities/xtep-international-holdings" target="_blank" data-smartkarma-citation="entities:18118:1" rel="noopener">Xtep International (1368 HK)</a> , <a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi Corp (1810 HK)</a> and <a href="https://www.smartkarma.com/entities/china-education-group-holdin" target="_blank" data-smartkarma-citation="entities:18218:1" rel="noopener">China Education Group (839 HK)</a> all had breakouts to form uptrends.  All are part of the consumption sector in China
</li>
</ul>


Hong Kong Dollar continues to trade at the strong end of its band  resulting in upward pressure on HIBOR in turn causing a further unwind of the HKD carry trade.
HSI shows the strongest market breadth in 15 years as nearly all members trade above 200 DMA.

Xtep International (1368 HK) , Xiaomi Corp (1810 HK) and China Education Group (839 HK) all had breakouts to form uptrends.  All are part of the consumption sector in China



Technically Speaking, Breakouts and Breakdowns: HONG KONG (OCTOBER 14)

Global TMT Analyst, Ex-PM, 30 years experience

Neil Campling

Thematic (Sector/Industry)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/topsports-international-holdings" target="_blank" data-smartkarma-citation="entities:28153" rel="noopener">Topsports International Holdings (6110 HK)</a> miss suggests inventory fire sale ahead. Negative for demand in China, <a href="https://www.smartkarma.com/entities/nike-inc-cl-b" target="_blank" data-smartkarma-citation="entities:6658:1" rel="noopener">Nike (NKE US)</a>, <a href="https://www.smartkarma.com/entities/anta-sports-products-ltd" target="_blank" data-smartkarma-citation="entities:10261:1" rel="noopener">Anta Sports Products (2020 HK)</a> and the whole sector</li>
<li>Chinese consumers aren't buying <a href="https://www.smartkarma.com/entities/bayerische-motoren-werke-ag-bmw-72824b26-c157-46b2-bafe-650cb75a091f" target="_blank" data-smartkarma-citation="entities:21591:1" rel="noopener">Bayerische Motoren Werke (BMW) (BMW GR)</a> or going to the Movies</li>
<li>But Americans are still walking in Westerns Boots <a href="https://www.smartkarma.com/entities/boot-barn-holdings-inc" target="_blank" data-smartkarma-citation="entities:11647:1" rel="noopener">Boot Barn Holdings (BOOT US)</a> </li>
</ul>



Topsports International Holdings (6110 HK) miss suggests inventory fire sale ahead. Negative for demand in China, Nike (NKE US), Anta Sports Products (2020 HK) and the whole sector
Chinese consumers aren't buying Bayerische Motoren Werke (BMW) (BMW GR) or going to the Movies
But Americans are still walking in Westerns Boots Boot Barn Holdings (BOOT US) 


Global Consumer (Midweek Update): Consumer Woes Persist, Especially in China.

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>2023 gameplan remains unchanged; we see limited upside from here for ACWI-US, and we expect a rangebound year of trading on ACWI-US with $93 capping upside and $75-77 capping downside</li>
<li>We also remain overweight Europe/UK, we want to add exposure on pullbacks to China/Hong Kong/EM, and overweight non-U.S. equities (MSCI ACWI ex-US) relative to MSCI ACWI</li>
<li>We highlight buy ideas within Technology, Communications, and Consumer Discretionary. The UK/Europe and Hong Kong/China continue to make up the majority of our buy recommendations</li>
</ul>


2023 gameplan remains unchanged; we see limited upside from here for ACWI-US, and we expect a rangebound year of trading on ACWI-US with $93 capping upside and $75-77 capping downside
We also remain overweight Europe/UK, we want to add exposure on pullbacks to China/Hong Kong/EM, and overweight non-U.S. equities (MSCI ACWI ex-US) relative to MSCI ACWI
We highlight buy ideas within Technology, Communications, and Consumer Discretionary. The UK/Europe and Hong Kong/China continue to make up the majority of our buy recommendations


Major Top on U.S. Dollar; Overweight Non-U.S. And Europe/UK; Buys in Tech, Comm., Discretionary

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>While China's U-turn on COVID policy is expected to bring consumption rebound in 2023, the near-term surge in infections will weigh negatively on retail sales in Dec and Jan.</li>
<li>Residents are spending more time at home in the first wave, with subways and shopping malls empty. We think this will cast negativity on 4Q22 and 1Q23 consumer discretionary profit.</li>
<li>It is prudent to take some monies off the table, particularly F&amp;B stocks like <a href="https://www.smartkarma.com/entities/haidilao-international-holding-ltd" target="_blank" data-smartkarma-citation="entities:27044:1" rel="noopener">Haidilao (6862 HK)</a>, <a href="https://www.smartkarma.com/entities/xiabuxiabu-catering-mgt-chn-hldgs-co-ltd" target="_blank" data-smartkarma-citation="entities:76:1" rel="noopener">Xiabuxiabu (520 HK)</a> and <a href="https://www.smartkarma.com/entities/helen-s-international-holdings" target="_blank" data-smartkarma-citation="entities:34113:1" rel="noopener">Helen's (9869 HK)</a> which have almost doubled from trough.</li>
</ul>


While China's U-turn on COVID policy is expected to bring consumption rebound in 2023, the near-term surge in infections will weigh negatively on retail sales in Dec and Jan.
Residents are spending more time at home in the first wave, with subways and shopping malls empty. We think this will cast negativity on 4Q22 and 1Q23 consumer discretionary profit.
It is prudent to take some monies off the table, particularly F&amp;B stocks like Haidilao (6862 HK), Xiabuxiabu (520 HK) and Helen's (9869 HK) which have almost doubled from trough.


China COVID Policy: Near-Term Pains for Consumer Discretionary

Hong Kong

Topsports International Holdings Limited is a leading sportswear retailer primarily engaged in the trading of sports shoes and apparel, and the distribution of international brands such as Nike, Adidas, and Puma. The company also leases commercial spaces for concessionaire sales and operates in the esports sector. It was founded in 1999 and is headquartered in Kwai Chung, Hong Kong.

Price Gauge
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Topsports International (6110 HK)

BUY/SELL/HOLD: Hong Kong Stock Updates (October 15)

Healthcare sector gains momentum in HK and materials and energy lag. Anta is appealing to the mass market with new megastores. JDH benefits from...

David Mudd

Technically Speaking, Breakouts and Breakdowns: HONG KONG (OCTOBER 14)

HKD strengthens, HIBOR moves higher and HK shorts become more expensive. HK market breadth reached its highest level in 15 years last week. Xtep,...

David Mudd

Global Consumer (Midweek Update): Consumer Woes Persist, Especially in China.

Topsports miss signals inventory fire sale in China, impacting Nike, Anta Sports Products, and the sector as a whole. Chinese consumers shun...

Neil Campling

Major Top on U.S. Dollar; Overweight Non-U.S. And Europe/UK; Buys in Tech, Comm., Discretionary

The $DXY broke below 5-year support at $103, signaling a major top in place. This is bullish for risk assets, and is another sign suggesting the...

Vermilion Research

China COVID Policy: Near-Term Pains for Consumer Discretionary

Near-term negative impact of China's U-turn in COVID policy on consumer discretionary has been underestimated by the market. It is prudent to take...

Osbert Tang, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

BUY/SELL/HOLD: Hong Kong Stock Updates (October 15)

Healthcare sector gains momentum in HK and materials and energy lag. Anta is appealing to the mass market with new megastores. JDH benefits from...

David Mudd

Technically Speaking, Breakouts and Breakdowns: HONG KONG (OCTOBER 14)

HKD strengthens, HIBOR moves higher and HK shorts become more expensive. HK market breadth reached its highest level in 15 years last week. Xtep,...

David Mudd

Global Consumer (Midweek Update): Consumer Woes Persist, Especially in China.

​Topsports miss signals inventory fire sale in China, impacting Nike, Anta Sports Products, and the sector as a whole. Chinese consumers shun...

Neil Campling

Major Top on U.S. Dollar; Overweight Non-U.S. And Europe/UK; Buys in Tech, Comm., Discretionary

The $DXY broke below 5-year support at $103, signaling a major top in place. This is bullish for risk assets, and is another sign suggesting the...

Vermilion Research

China COVID Policy: Near-Term Pains for Consumer Discretionary

Near-term negative impact of China's U-turn in COVID policy on consumer discretionary has been underestimated by the market. It is prudent to take...

Osbert Tang, CFA

Topsports miss signals inventory fire sale in China, impacting Nike, Anta Sports Products, and the sector as a whole. Chinese consumers shun...