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Smartkarma Daily Briefs

Jun 19
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan | US Equities-Risks Elevated? ; NUGGET: SBI HD(8473)-Carbon Trading and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan | US Equities-Risks Elevated? ; NUGGET: SBI HD(8473)-Carbon Trading, Jumping in Early
  • China Stimulus: Benefiting China Infrastructure Construction Sector
  • Weekly Stock Bullfinder – Week of 6/19
  • ARK Invest Short & Squeeze – Edition #3

Ohayo Japan | US Equities-Risks Elevated? ; NUGGET: SBI HD(8473)-Carbon Trading, Jumping in Early

By Mark Chadwick

  • OVERSEAS.  SPX -0.4%  1st down day  7 as Markets price in Peak rates/rate declines;  SPX Looks risky here(More BELOW); China revamps NEV subsidies; Putin places tactical Nukes in Belarus..mmm
  • JAPAN. NKY Futs flat vs Cash;  USDJPY 141.8 post-BOJ on Friday;  NKY wins for 10th week; Kishida survives no-confidence motion; TEPCO goes full into Renewables; Lawsons makes a China push
  • NUGGET. SBI HD(8473) – Carbon Trading, Jumping in Early in what sets up to be a major opportunity

China Stimulus: Benefiting China Infrastructure Construction Sector

By Osbert Tang, CFA

  • Both the State Council and NDRC reiterated last week the importance of introducing economic stimulus measures. These measures should benefit the infrastructure construction companies.
  • 1Q23 new contract growth, ranging between 6.3% and 15.8%, is healthy. With issuance of special purpose bonds up 16.5% in 4M23, new contract momentum looks to accelerate.
  • We view China Communications Construction (1800 HK) most positively, given its diversified sub-segment coverage, highest overseas exposure, and best forward pipeline.

Weekly Stock Bullfinder – Week of 6/19

By Weekly Stock Bull Finder

  • The ITB US Home Construction ETF is now up 33% YTD and represents one of the biggest market surprises for me so far in 2023.
  • This group has flashed relative strength vs. the S&P 500 since December 2022 and continues to one of the top performing groups.
  • After undergoing correction in 2022, the homebuilders sector has tons of weekly charts breaking out of long and healthy weekly bases in strong uptrends

ARK Invest Short & Squeeze – Edition #3

By Maverick Equity Research

  • All 6 ETFs positive in 2023 while ARKW ARKF ARKK ARKQ booming with 35%, 27%, 25% & 17% respectively.
  • Risk appetite for the Innovation/Hyper Growth thematic is on!
  • Enhanced Price Action view: Ark 6 ETFs 2023 Returns & Rebounders from their 52-week low + I added S&P 500 (SPY) and the Nasdaq 100 (QQQ) for comparison

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Jun 19
0

Daily Brief Macro: How to Trade the Split Personality Market and more

By | Daily Briefs, Macro

In today’s briefing:

  • How to Trade the Split Personality Market
  • How Economic Myopia Is Leading Investors Astray
  • Modern Monetary Policy Conduct: Pausing Becomes Fashionable Despite Sticky Inflation

How to Trade the Split Personality Market

By Cam Hui

  • The U.S. equity market is becoming very bifurcated. Leadership is composed of a handful of frothy growth names while value and cyclicals are laggards and signaling recessionary conditions.
  • Investors who want to trade growth stocks can use the price momentum factor.
  • Investors who are seeking value opportunity should consider Japan and Eurozone equities.

How Economic Myopia Is Leading Investors Astray

By Cam Hui

  • Investors have become overly myopic about the nature of the latest economic cycle.
  • This cycle should really be viewed as an elongated recovery from the 2020 pandemic .
  • The best analogy of the current cycle is the double-dip recession in the manner of 1980–1982.

Modern Monetary Policy Conduct: Pausing Becomes Fashionable Despite Sticky Inflation

By Said Desaque

  • The Fed’s decision not to raise the federal funds rate is not expected to presage a prolonged break, particularly if the real economy and inflation remain resilient.
  • Guidance towards further increases in the Fed’s policy rate could reflect greater confidence by members about the outlook for the banking system and the availability of credit.
  • Companies have preserved operating margins via higher selling prices. Lower inflation will necessitate a compression in profitability.  Housing stabilisation and buoyant US equity prices suggest Fed policy is not tight. 

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Jun 19
0

Daily Brief Energy/Materials: Jericho Energy Ventures , Ranpak Holdings Corp and more

By | Daily Briefs, Energy & Materials Sector

In today’s briefing:

  • JEV – The Best of Both Worlds: O&G and Hydrogen
  • Wrapped in Sustainability

JEV – The Best of Both Worlds: O&G and Hydrogen

By Atrium Research

  • Jericho’s O&G JV assets are harvesting record cash flow and growing production steadily. 
  • JEV’s wholly owned Hydrogen Technologies has an innovative solution for clean hydrogen boilers.
  • This business allows JEV to generate non-dilutive cash flow which can be re-invested in the high multiple hydrogen industry.

Wrapped in Sustainability

By subSPAC

  • The pandemic triggered a surge in e-commerce, prompting a scramble for innovative delivery solutions.
  • Amongst this evolution, the need for sustainable packaging emerged as a priority for companies aiming to reduce industrial emissions.
  • Ranpak Holdings, a provider of eco-friendly packaging, thrived amidst this landscape, capitalizing on pandemic-driven growth.

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Jun 19
0

Daily Brief Industrials: Toshiba Corp, Evergreen Marine Corp and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Weekly Deals Digest (18 Jun) – Toshiba, Kenedix, Abacus Storage King, Austal, Hailan, Yitai Coal
  • Monthly Container Shipping Tracker | Rates Stable | Strike Averted | Fuel Prices Lower  (June 2023)

Weekly Deals Digest (18 Jun) – Toshiba, Kenedix, Abacus Storage King, Austal, Hailan, Yitai Coal

By Arun George

Monthly Container Shipping Tracker | Rates Stable | Strike Averted | Fuel Prices Lower  (June 2023)

By Daniel Hellberg

  • Our index suggests long-haul rates remained stable in May as carriers approach peak season
  • Cleanup of West Coast slowdown, lower fuel prices should both serve as Summer tailwinds
  • We believe conditions could improve in H2 2023, and shares remain cheap on Price / Assets

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Jun 19
0

Daily Brief Industrials: Toshiba Corp, Evergreen Marine Corp and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Weekly Deals Digest (18 Jun) – Toshiba, Kenedix, Abacus Storage King, Austal, Hailan, Yitai Coal
  • Monthly Container Shipping Tracker | Rates Stable | Strike Averted | Fuel Prices Lower  (June 2023)

Weekly Deals Digest (18 Jun) – Toshiba, Kenedix, Abacus Storage King, Austal, Hailan, Yitai Coal

By Arun George

Monthly Container Shipping Tracker | Rates Stable | Strike Averted | Fuel Prices Lower  (June 2023)

By Daniel Hellberg

  • Our index suggests long-haul rates remained stable in May as carriers approach peak season
  • Cleanup of West Coast slowdown, lower fuel prices should both serve as Summer tailwinds
  • We believe conditions could improve in H2 2023, and shares remain cheap on Price / Assets

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Jun 19
0

Daily Brief TMT/Internet: Tokyo Stock Exchange Tokyo Price Index Topix, Sea , Delta Electronics Thai, Taiwan Semiconductor (TSMC) – ADR, Macbee Planet and more

By | Daily Briefs, TMT/Internet

In today’s briefing:

  • JAPAN FLOW: Foreign Investor Inflows Increased; Next Is Foreigners Vs Buybacks Vs GPIF
  • SE/Tiktok:Chinese Practitioners’ Discussions About TikTok’s E-Commerce Business in Southeast Asia
  • Delta Taiwan Vs. Thailand Monitor: Delta Thai Surges On No News; When Will SET50 Be Fixed?
  • Taiwan Tech Weekly: Nvidia Highlights Intel & Mediatek; AI Server DRAM Demand; Delta Price Surges
  • Macbee Planet (7095) – Firing on All Cylinders

JAPAN FLOW: Foreign Investor Inflows Increased; Next Is Foreigners Vs Buybacks Vs GPIF

By Travis Lundy

  • On 8 May I wrote JAPAN FLOW: Foreign Investor Inflows May Increase.  Since the data used in that insight, TSE data shows net foreign buying of ¥3.5trln+. 
  • Investor flows appear to work in patterns which are correlated to TOPIX gains and outperformance vs S&P500. 
  • The history of autocorrelation of net buying suggests while the current streak may end, a four week average of net buys could remain positive for a while. 

SE/Tiktok:Chinese Practitioners’ Discussions About TikTok’s E-Commerce Business in Southeast Asia

By Shawn Yang

  • Recently, there has been more discussion about TikTok’s e-commerce business in Southeast Asia on Chinese media and social networks.
  • Many service providers and entrepreneurs in China have also been inspired and hope to take the lead in the market with their domestic experience.
  • We estimate that TikTok’s 2023 GMV in Southeast Asia will reach 20%~ of Shopee, and this is one of the key reasons why we are bearish to SE.

Delta Taiwan Vs. Thailand Monitor: Delta Thai Surges On No News; When Will SET50 Be Fixed?

By Vincent Fernando, CFA

  • Delta Thailand surged 20% since our last trade monitor piece. This was without any significant news and the company received another query from the stock exchange as a result.
  • Delta Taiwan increased by a higher 22%, thus the extreme valuation mismatch between the two has corrected slightly. Delta Taiwan is still only 0.78x the market cap of Delta Thailand.
  • Delta Taiwan last week announced the acquisition of a German company that makes components for vehicles. This will strengthen Delta’s battery management product portfolio and add client relationships.

Taiwan Tech Weekly: Nvidia Highlights Intel & Mediatek; AI Server DRAM Demand; Delta Price Surges

By Vincent Fernando, CFA

  • More Nvidia Takeaways from two conferences the company spoke at — The company highlighted support for Intel’s new Foundry business, Mediatek, and why automakers will absolutely need AI to compete.
  • Memory Chip Stocks — Nanya jumps 10% on hopes that AI servers will need 7x the value of DRAM. Micron warns that half of China revenue could be at risk.
  • Delta Taiwan and Thailand Surge 20%+, Taiwan outperforms. Delta Taiwan has acquired a German automotive components company to boost its EV powertrain products lead.

Macbee Planet (7095) – Firing on All Cylinders

By Astris Advisory Japan

  • Q1-4 FY4/2023 results were ahead of revised company guidance and our earnings estimates, highlighting the company’s success in 1) driving demand at both existing and newly acquired customers, and 2) implementing Marketing Technology services that are improving the overall sales mix and driving margin growth.
  • On this fundamentally robust basis, the company acquired Net Marketing in April 2023, an advertising agency that will allow access to new customers in which to sell-in profitable Marketing Technology services and replicate its effective model, as well as gain exposure to a more diversified range of market sectors.
  • Strong outlook for FY4/2024 – we revise our earnings estimates for FY4/2024 and beyond, reflecting the following: 1) stronger topline growth in Analytics Consulting, 2) a more enhanced trajectory of profitability improvement in the medium term, given the success of Marketing Technology services to date.

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Jun 19
0

Daily Brief Consumer: Great Wall Motor, Makalot Industrial, Golden Eagle Retail, Amara Holdings and more

By | Consumer, Daily Briefs

In today’s briefing:

  • Great Wall Motor (2333 HK) – RMB Dual Counter Trading Starts Today, Watch that A-Share Discount
  • Yuanta/​P-Shares Taiwan Dividend Plus ETF: Day 1 Flows & Stock Moves
  • Merger Arb Mondays (19 Jun) – Golden Eagle, Hailan, Yitai Coal, Toshiba, Kenedix, Tesserent, Oishi
  • Amara Holdings (AMA SP): Key Shareholders Ponder an Offer

Great Wall Motor (2333 HK) – RMB Dual Counter Trading Starts Today, Watch that A-Share Discount

By Travis Lundy

  • 24 different HK-listed stocks will be tradable in RMB on the HKEX starting 19 June. They make up 35% of HKEX market cap, 40% of total turnover. They are fungible.
  • The ultimate goal is to allow mainland investors to trade HK stocks in RMB, but we’re not there yet. Southbound has yet to be approved for the 21 SB-eligible names.
  • Only five of the 24 have A-shares, and of those, three (China Mobile, CNOOC, and Great Wall Motor) have wide H-share discounts. Those should be the ones to look at.

Yuanta/​P-Shares Taiwan Dividend Plus ETF: Day 1 Flows & Stock Moves

By Brian Freitas

  • The Yuanta/P-shares Dividend Plus ETF (0056 TT) started to rebalance its holdings on Friday and will continue to do so for the next 4 trading days.
  • Stocks with buy flows dropped 0.8% on average on Friday while the stocks with sell flows rose 0.27%. On a flow weighted basis, the numbers were -0.63% vs +1.99%.
  • The stocks with outflows have outperformed stocks with inflows by a huge margin in the recent past and short interest has jumped on most stocks recently.

Merger Arb Mondays (19 Jun) – Golden Eagle, Hailan, Yitai Coal, Toshiba, Kenedix, Tesserent, Oishi

By Arun George

Amara Holdings (AMA SP): Key Shareholders Ponder an Offer

By Arun George

  • Amara Holdings (AMA SP) received a written notification from Mr Albert Teo Hock Chuan (CEO) and Ms Susan Teo Geok Tin (Company Secretary) that they mulling an offer. 
  • The shares entered a trading halt on 16 June as the share price increased 23.9% from S$0.355 on 14 June to S$0.440 per share on 16 June.
  • Recent SGX privatisation proposals have shown that offerors tend to be miserly with their premiums. The sharp share price rally makes it challenging to launch an offer.

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Jun 19
0

Daily Brief Health Care: Celltrion Healthcare, BeiGene Ltd and more

By | Daily Briefs, Healthcare

In today’s briefing:

  • Celltrion Healthcare (091990 KS): Portfolio Enhancement to Drive Business Growth
  • BeiGene (6160.HK/​BGNE.US) – AbbVie‘s Patent Infringement Allegations Are Not as Simple as Imagined

Celltrion Healthcare (091990 KS): Portfolio Enhancement to Drive Business Growth

By Tina Banerjee

  • Celltrion Healthcare (091990 KS) is expected to launch Humira biosimilar, Yuflyma, in the U.S. market in July 2023. Despite heavy competition, as high-concentration citrate-free formulation, Yuflyma has competitive edge.
  • In April 2023, Celltrion has launched bevacizumab biosimilar, Vegzelma in the U.S. Vegzelma will be the first product that the company will be directly selling in the U.S.
  • Through portfolio expansion, Celltrion increased target market size to $53.7B in 2023 from $20.6B in 2020, representing 161% growth. For 2024, the target market is expected to increase to $91.3B.

BeiGene (6160.HK/​BGNE.US) – AbbVie‘s Patent Infringement Allegations Are Not as Simple as Imagined

By Xinyao (Criss) Wang

  • AbbVie’s patent infringement allegations against BeiGene Ltd (6160 HK) is an attempt to obstruct BeiGene through legal means and save Imbruvica’s sales decline in the market. AbbVie came prepared this time.
  • BeiGene has a chance to win the lawsuit if without any political factors.But if BeiGene fails to walk away unscathed, any damages/patent royalty would be detrimental to its financial performance/forecast.
  • The real key point in determining BeiGene’s future turnaround is not this lawsuit, but the clinical results of TIGIT project. Even with the correction since May, BeiGene is still expensive.

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Jun 19
0

Daily Brief Financials: UOB, JPY, Bitcoin Pro and more

By | Daily Briefs, Financials

In today’s briefing:

  • UOB & DBS – Major Divergence In Bad Loans Over Past 2 Crises
  • USD Trade Splinters
  • The Collision of AI and Blockchain Technology

UOB & DBS – Major Divergence In Bad Loans Over Past 2 Crises

By Daniel Tabbush

  • UOB saw bad loans rise 22% during the GFC where DBS saw bad loans rise 146%
  • During oil price collapse at FY16, DBS saw NPLs up 83%, UOB saw NPLs up 41%
  • In current downturn, a market capitalization decline may be less at UOB vs DBS

USD Trade Splinters

By Thomas Schroeder

  • Our proposed USD bull trade from DXY 102.60 (104.80 target zone) is in jeopardy after the ECB induced Euro spike. 
  • Sterling has been our top USD short and the USD/JPY a top USD long. The Euro is under scrutiny but has been capped under 1.11.
  • We will be looking for further evidence of USD bearish elements. DXY below 102 would be more bearish but would be in line with a near term slide in yield.

The Collision of AI and Blockchain Technology

By Etherbridge

  • Human beings are engineers. Our historical narrative is marked by our constant ability to control our environment through innovative strides known as technology.
  • Typically, our most significant collective progress is linked with technologies that enhance our capacity to distribute information and foster trust.
  • Consider the societal transformation that occurred after the invention of the printing press. It was not just about more books – the dissemination of knowledge it facilitated catalysed the Scientific Revolution, forever altering our understanding of the world. 

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Jun 18
0

Daily Brief South Korea: Almac, Lutronic Corp and more

By | Daily Briefs, South Korea

In today’s briefing:

  • Almac IPO Bookbuilding Results Analysis
  • (Mostly) Asia-Pac Weekly Risk Arb Wrap: Lutronic, Hailan, Mason, Tesserent, Kenedix

Almac IPO Bookbuilding Results Analysis

By Douglas Kim

  • Almac announced its IPO price of 50,000 won, which is 11% higher than the high end of the IPO price range. Demand ratio was very high at 1,697 to 1.
  • A 98.7% of the IPO shares applied thought that the company’s value is more than 45,000 won
  • Given the exceptional demand for IPO shares, it is likely that the IPO share price is likely to trade at higher end of the IPO range in our sensitivity analysis.

(Mostly) Asia-Pac Weekly Risk Arb Wrap: Lutronic, Hailan, Mason, Tesserent, Kenedix

By David Blennerhassett

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