Thematic (Sector/Industry)

• The Dow Jones Industrial Average rose 0.34% to 38,791, while the S&P 500 hit a new record close, climbing 1.03% to 5,157
• Speculation over the Bank of Japan’s policy shift triggers yen’s strengthening, leading to a sell-off in export-oriented stocks.
• Japan’s largest labor confederation announced on Thursday that wage increase demands from its member unions have reached a 31-year high

• It’s the first MoM decline in semi sales since February 2023, but it’s a seasonal thing & YoY comparisons continue to grow stronger. 
• Forecasting 10% YoY growth in 2024 semiconductor sales, in line with TSMC’s outlook
• $1 trillion in annual semiconductor sales will likely happen in 2032 based on a 7.7% CAGR over the coming decade. 

• Federal Reserve Chair Jerome Powell reaffirms potential interest rate cuts, pending sustained evidence of inflation slowdown.
• ADP National Employment Report shows private sector job growth in February, surpassing January but missing Wall Street predictions
• Japanese firms enact substantial job cuts despite stock market surge, reflecting strategic restructuring amid rising wages.

• Stan Druckenmiller just bought shares in Barrick Gold and Newmont Mining.

• He thinks gold serves as a store of value, but only over the long run. It’s a hedge against any devaluation of the US Dollar.

• He also seems to think that gold prices should go up in a scenario of lower interest rates, higher inflation rates or a combination of both.

• NTES/700 HK : NPPA has released the February approvals for domestic game codes, with <Black Myth: Wukong> and <Naraka Mobile> receiving approval. (+)
• NTES: NetEase has established a new overseas studio, led by former <Call of Duty> designer.(+)
• BABA/BIDU/700 HK: Alibaba Cloud announces steep discounts on hardware products (+/-/-)

• E-Commerce growth slowed marginally as the sector consolidated post-Covid but remained higher than any other channel in 2022. 
• By 2025-26, it will be the largest channel, overtaking convenience stores – but Japan’s continuing support for retail stores means that omnichannel will be the main model.
• As a result, the majority of transactions will be researched, initiated, and fulfilled through a combination of online and physical stores.

• LI/XPEV/NIO: Li, Xpeng and GAC AION announced new price actions（+/+/-）
• ZLAB: Zai Lab’s revenue growth in 4Q23 is weak, and loss narrowing is limited （-）
• 1810 HK: Qualcomm exhibited a number of client-side LLM products at MWC Barcelona, covering mobile phones, PCs and communications（+）

• Bitcoin hit a high of $69,202 hitting an all time high. It then reversed course and fell to $63,400
• US stocks closed down by around 1% on Tuesday dragged down by weakness in tech stocks; Apple shares -2.8% on China iphone slump
• Tesla shares were ~4% lower after production halted at Giga factory in Berlin. Tesla also seeing 16% drop in auto shipments in China. 

• The yields on financial assets at DBS is now 3.92% for FY23. This compares with 4.64% for OCBC. 
• The change in yields on financial assets at DBS in the past year is 160bps compared with 194bps for OCBC.
• From FY19 to FY23 OCBC has only added SGD70bn to its total financial assets or +19%. DBS added SGD169bn or +28% over this period.

• S&P ends lower as Apple receives a 1.8 billion euro antitrust fine from the EU; APPL -2%
• Crypto stocks lead gainers as Bitcoin surges +7% to $67,000. Super Micro Computer jumps +18% on AI 
• China is anticipated to set its annual growth rate for 2024 at “around 5%” during the upcoming National People’s Congress

• After a quiet week in the sector, three earnings reports will get the attention of investors in the furniture/furnishings space this week.
• Culp Inc. will report its 3QFY24 results after the close on Wednesday, March 6 and host an investor call at 11:00 am on Thursday, March 7.
• We expect EPS of a loss of $0.22 on revenue of $60 million. Consensus is EPS of a loss of $0.19 on revenue of $59.5 million.

• The US cannabis MSOS ETF fell 7.80% last week, its third loss in the last four weeks.
• Earnings this week were relatively strong, but sentiment around federal reform may be driving short-term prices.
• Despite the sell- off, MSOS had $1.8 million in inflows. The global YOLO ETF held up better, losing 1.89% over the last five sessions.

• The WTR Sustainable Index was up by 4.3% W/W versus the S&P 500 Index (up 0.9%), the Russell 2000 Index (up 3.0%), and the Nasdaq Index (up 2.0%).
• Energy Technology (12.7% of the index) was up by 3.9%, while Industrial Climate and Ag Technology (53.5% of the index) was up by 1.4%, ClimateTech Mining was down 0.7% and Advanced Transportation Solutions (27.9% of index) was up 11.2%.
• Top 10 Performers: ENG, AMY, TPCS, HYLN, VIEW, XOS, AMYZF, SMR, EVA, PMET,

• US Stocks end higher on Friday, with the S&P 500 and Nasdaq rising to new records
• Sakura Internet emerges as latest AI play with high-powered cloud services. Stock up 93% over past month
• Japanese auto makers see continued strong US auto sales; Nissan potentially to invest $400m in EV truck maker, Fisker

• Supportive policies from central and local governments on the development of the hydrogen energy industry have boosted the share prices of the sector (up 12.3% YTD).
• Inner Mongolia has eased regulations on electrolysis water hydrogen production projects while Shandong has waived hydrogen-powered vehicle tolls on highways. 
• Beijing SinoHytec (2402 HK), Weichai Power (2338 HK), Dongyue Group (189 HK), CIMC Enric (3899 HK), and Dongfang Electric (1072 HK) have recorded good progress in hydrogen business.

• The last week saw the return of mega SPAC deals, with a SPAC announcing plans to take an online trading platform public, and the brand management business of an airline going public through a merger with a blank-cheque firm.
• Also, a SPAC switches merger targets, and Trump’s media firm gets sued by its co-founders. Read on to find out the latest about all things SPACs.  
• New York-based online brokerage Webull is going public through a merger with SPAC SK Growth Opportunities Corporation in a deal valuing the firm at $7.3 billion. 

• 2023 WFE revenues amounted to $93 billion, representing a YoY decrease of just ~1%. Most had expected a 20% YoY decline at the start of last year
• We forecast 2024 WFE revenues to grow modestly by around 5% YoY
• China’s WFE spend in 2023 was ~1.5x Taiwan & ~2x Korea

• The Global Emerging Markets Weekly summarizes the key news and related developments impacting the largest countries and constituents of the Global Emerging Markets equity indices.
• Macro data points: China PMI data, India GDP growth data
• Companies mentioned:Ant Group (6688 HK), Alibaba Group Holding (9988 HK), NetEase (9999 HK), Reliance Industries (RIL IN)

• The AI GPU market has been exploding, and this has turned the DRAM market’s downturn into a strong upturn
• With this growth, DRAM manufacturers have seen their business turn around, thanks to increased use of HBM
• Two questions concern us: Will AI growth last? Will increased competition in HBM DRAM create a price collapse?

• This note is a weekly curated selection of Chinese news articles and company announcements focused on developers in distress
• We look for their deals, updates, specific project progress news (‘local signals’), as well as relevant local research commentaries about the market
• We do not verify the underlying data or provide any opinion, we only select and summarize the information; See direct links to sources

• A wave of mergers and acquisitions in the oil and gas sector has offered opportunities for Chinese companies to optimize their overseas assets, but uncertainty in the offshore investment environment is also rising, a report by a think tank part of state-owned oil giant China National Petroleum Corp. (CNPC) found.
• The total value of global oil and gas mergers and acquisitions skyrocketed to more than $250 billion last year, including mega deals involving ExxonMobil and Chevron, making 2023 the largest upstream annual spend in more than a decade.
• “The competitive landscape is reshaping, and the era of mega mergers in the industry has arrived,” Wu Moyuan, vice president of CNPC Economic and Technological Research Institute, said Wednesday at the release of the report.

• The Nikkei 225 Index surged 2% to a record high of 39,911, driven by a weak yen, robust corporate earnings, and optimism surrounding artificial intelligence
• Japan’s stock market has quietly undergone a significant transformation, emerging as an increasingly attractive investment prospect. Investors are Underweight
• The decline of cross-shareholdings signals a positive shift towards improved capital allocation and, enhanced shareholder value. I see TWO key positives….

• ADX Energy (ADX AU)C; target price of £A$0.65 per share: High impact well spud in Austria – The Welchau-1 gas exploration well was spudded on 24 February.
• Calima Energy (CE1 AU)C; target price of A$0.13 per share: Completing divestment of Blackspur – Blackspur has been sold for A$81.6 mm, after tax provisions and net debt adjustments.
• Calima will distribute A$80 mm (~A$12.6 per share) as dividends.

• Nearly half of the power traded on China’s electricity market in 2023 came from wind and solar plants, doubling from just two years ago, according to an energy expert.
• The portion of “new energy”— which refers to wind and solar energy — in the total amount of power traded last year surged to 44%, up from 22% in 2021 and 32% in 2022, according to figures released at an industry seminar held in Beijing on Tuesday.
• New energy is expected to be “fully integrated” in the country’s electricity trading by 2030 as Beijing deepens its power reforms, said Dong Feifei, a power engineer who presented the figures.

• 2023 DRAM + NAND revenues declined 36% YoY from $140.3 billion to $89.2 billion. This followed a 14% decline YoY in 2022.
• Forecasting ~40% YoY growth in 2024, bringing overall memory revenues back to roughly 2022 levels
• ASML’s Memory-related WFE revenue in 2023 was an all time record high at $5.9 billion. Much of that was spent in China and its impact remains to be seen..

• The Nasdaq Composite surged 0.90% to a historic closing high of 16,091.92
• Japan’s January factory output plummeted by 7.5%, the sharpest decline since May 2020
• Four non-life insurance companies, including Tokio Marine & Nichido Fire Insurance, announced the sale of all cross-shareholdings valued at approximately 6.5 trillion yen

• Semiconductor chips are essential building blocks of innovation and technological advancements in areas such as artificial intelligence, electrification, and cloud computing.
• The global shortage of semiconductor chips has affected industries beyond high-tech products, such as the automotive industry where chips are vital for various functions like safety features, infotainment systems, and driver assistance technologies.
• Understanding the significance of semiconductor chips can provide valuable insights for investors looking to capitalize on opportunities in the growing semiconductor industry.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• Nikkei Futures point to a weak open as US stocks decline ahead of pivotal inflation data
• Apple culls its Auto business to focus on AI….further proof that Toyota had the right strategy all along. 
• Apple’s Vision Pro is stuffed with seriously high-end Japanese electronics.

• The S&P 500 and Nasdaq closed Tuesday with slight gains ahead of key inflation data.
• Japanese trading houses soared to record highs following Warren Buffett’s bullish remarks, robust earnings, and share buyback plans
• Japan core consumer price index, excluding fresh food, rose by 2% year-on-year, down from December’s 2.3% increase

• Large US bank weekly data shows a fragile economy still with negative 1.4% C&I loan growth YoY in the most recent week’s data
• Total loans for large US banks are up only 0.5% YoY in the most recent week which is down from 0.7% to 1.3% just 4-5 months ago
• Large time deposit growth is decelerating but remains very high at 84% YoY in the most recent week’s data, suggesting still core income pressure

• I was today-years-old when I learned that Europe has its own version of the Magnificent 7; the basket of giga-cap US tech companies comprised of Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla.
• The GRANOLAS Dubbed the “Granolas” by Goldman Sachs in 2020, this basket was chosen because it echoed themes present amongst the Mag 7 (back then it was just “FAAMG”) .

• Namely, they were market leaders in the STOXX 600 Europe Index, they had grown to become an increasingly larger share of the market, and their earnings had far outpaced the broader index.

• LI/XPEV/NIO/1211 HK:  Sales of strong EV brands held up better during CNY, Li and Tesla led and AITO and BYD followed (+)
• BEKE : ByteDance suspend self-operating home decoration business( + )
• ZLAB:Bristol-Myers Squibb （BMS） outsources Opdivo sales in ten southwestern provinces to Zai Lab, a long-term positive but with many prerequisites (+)

• 1810 HK/BIDU: Google’s Gemma is an important move for client-side AI (+)
• 3690 HK: Local news said Douyin has deemphasized take out business (+)
• PDD/4689 JP/AMZN/4385 JP/4755 JP: Data indicates that Temu is particularly popular in Japan (+/~/-/-/-)

• The growth in retail media (brand advertising delivered in stores based on detailed customer data) continues to be one of the big trends in 2024.
• Large retailers are keen to add this new revenue stream – and lots of brands want to advertise with them – and companies like Rakuten are offering this service directly.
• For many retailers, they still need help from experts in advertising and data analysis to make it work, providing an opportunity for Hakuhodo among others.

• The WTR Sustainable Index was down by 0.5% W/W versus the S&P 500 Index (up 1.7%), the Russell 2000 Index (down 0.8%), and the Nasdaq Index (up 1.4%).
• Energy Technology (12.7% of the index) was down by 10.5%, while Industrial Climate and Ag Technology (55.2% of the index) was up by 2.0%, ClimateTech Mining was down 6.8%, and Advanced Transportation Solutions was down 2.2%.
• Top 10 Performers: EFOI, IPWR, CYDVF, ROOF, PGTK, CLIR, LITM, FIX, LOOP, RE

• With the “Postcard” series, our objective is to bring to our readers on-ground insights based on interactions across key channels located in tier 2 and tier 3 locations.
• For this Postcard, we traveled to Mandya, a city in the southern state of Karnataka, also known as the ‘Sugar City,’ on a rented E6 by BYD (1211 HK).  
• Sectors in focus include Consumer Finance, Mortgage Lenders, and Retailers.