In today’s briefing:
- KOSPI 200 and KOSDAQ 150 Rebalance Additions and Deletions Announced (December 2023)
- EIA and OPEC Watch: Depending on Nigeria and Iran
- Out of the Box #24 : Too Little Too Late Powell?
- Investing Is About Return and Risk – Update 34027
- CX Daily: Five Things to Know About China’s Unusual Sovereign Bond Issue
- PMIs Passed Seasonal Trough
KOSPI 200 and KOSDAQ 150 Rebalance Additions and Deletions Announced (December 2023)
- Korea Exchange announced KOSPI 200 rebalance additions and deletions today. There were 14 new additions and deletions (7 each).
- Some surprises in KOSPI 200 rebalance included addition of Seah Besteel and deletion of HDC Hyundai Development.
- There were a lot more additions and deletions in KOSDAQ 150 (34 total additions and deletions). Among the KOSDAQ 150 additions included Neowiz, JNTC, Lunit, and Jeio.
EIA and OPEC Watch: Depending on Nigeria and Iran
- Welcome to our weekly EIA watch paired with a few remarks on the postponed OPEC meeting.
- We have had a look at OPEC production and export numbers, and it seems like production is much more price bullish than actual net exports (meaning a draw on local OPEC inventories)
- Interestingly, the US, Nigeria, Iran, UAE (among others) have managed to fill a lot of the production gap left open by left open by Saudi Arabia.
Out of the Box #24 : Too Little Too Late Powell?
- Main points: Fed is riding a blind horse by letting the market dictate policy as we enter Q1 and we think that the cumulative effect of the great tightening along with the pending lags won’t be undone by the temporary easing of Financial Conditions
- Rates will struggle to keep up at these levels as the disinflation (also) has a tightening component to it if rates don’t follow suit
- Current labour market easing we have seen since peak is still consistent with usual recessionary patterns but is unlike to evolve in a linear manner from here.
Investing Is About Return and Risk – Update 34027
- In the past four months or so, stock prices haven’t done all that much. The MSCI World Index measured stands 1.5% higher than at the beginning of July.
- However, cash has performed just as well as equities, or even slightly better in the case of the MSCI World Index, with much lower risk.
- If we were to compare the Sharpe ratios (return divided by realized volatility) of stocks and cash over the past months, the gap between the two categories would be huge.
CX Daily: Five Things to Know About China’s Unusual Sovereign Bond Issue
- Bonds / : Five things to know about China’s unusual sovereign bond issue
Students /: U.S. draws fewer Chinese students, report says
Wanda /: Wanda unit seeks extension for $600 million dollar bonds
PMIs Passed Seasonal Trough
- The UK and Euro area flash PMIs increased by more than expected, making summer’s weakness increasingly look like the trough in activity growth.
- 2023’s path follows 2022 and the inverse of 2020 because we still see the pandemic corrupting seasonals. The five months ahead will be bullish if this pattern continues.
- Labour markets still look tight, albeit with some evidence of loosening. Monetary policy needs to stay tight until excess demand and inflation normalise.
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