In today’s briefing:
- CSI 500 Index Rebalance: 50 Changes a Side Leads to 12%+ One-Way Turnover
- Sembcorp Marine Takeover of Keppel O&M – Almost There
- SSE180/SSE380 Index Rebalance: Changes & Potential MSCI/FTSE Inclusions & Exclusions
- KOSPI 200 Sector/Size & KRX 300 Sector: Constituent Changes & Trading Points
- Merger Arb Mondays (28 Nov) – Yashili, Perpetual/Pendal, Nitro, Warrego, Chip Eng Seng
CSI 500 Index Rebalance: 50 Changes a Side Leads to 12%+ One-Way Turnover
- There are 50 changes a side for the CSI 500 Index at the upcoming rebalance that will be implemented at the close of trading on 9 December.
- One-Way turnover at the rebalance is estimated at 12.64% leading to a one-way trade of CNY 9.3bn. The Materials, Information Technology and Consumer Discretionary sectors are net gainers.
- 9 adds to the CSI 500 Index are deletes from the CSI 300 Index while 7 deletes from the CSI 500 Index are adds to the CSI 300 Index.
Sembcorp Marine Takeover of Keppel O&M – Almost There
- Last Wednesday, Keppel Corp (KEP SP) announced 8 Dec as the EGM date for shareholders to approve the AssetCo Transfer, the Keppel O&M/SMM combo, and the distribution of SMM shares.
- This should probably sail through. Investors who want to submit questions in advance can email [email protected] by 3pm 30 Nov.
- I still like Keppel. I think investors will find it attractive post-spin.
SSE180/SSE380 Index Rebalance: Changes & Potential MSCI/FTSE Inclusions & Exclusions
- There are 18 changes to the SSE180 Index and 38 changes to the SSE380 Index that will be implemented at the close of trading on 9 December.
- There will be 10 deletions from the MSCI Standard Index and 26 deletions from the FTSE All-World/All-Cap indices at the close on 9 December.
- Currently, 8 stocks meet the threshold/are close for inclusion in the MSCI China Index while there are 21 stocks that meet the threshold for inclusion in the FTSE All-World/All-Cap indices.
KOSPI 200 Sector/Size & KRX 300 Sector: Constituent Changes & Trading Points
- The additional Lotte Confectionery/Samyang Holdings flow will come from K200/KRX 300 Consumer Staples, K200 MidSmallCap, and K200 Ex-Top. However, the actual flow impact wouldn’t be significant.
- From a flow trading standpoint, the KOSPI 50’s HMM/Hanon System probably deserves our attention because additional inflows come from the pensions that account for more than half of local PASSIVE.
- Since their rebalancing trading tends to be somewhat dispersed, the return rate was the best when the position holding period was from T-3 to the effective date.
Merger Arb Mondays (28 Nov) – Yashili, Perpetual/Pendal, Nitro, Warrego, Chip Eng Seng
- We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
- Highest spreads 21Vianet Group (VNET US), Alliance Aviation Services (AQZ AU), Genex Power Ltd (GNX AU), Golden Energy & Resources (GER SP), Perpetual Ltd (PPT AU), 111 Inc (YI US).
- Lowest spreads Tyro Payments (TYR AU), Warrego Energy (WGO AU), Nitro Software Ltd (NTO AU), Chip Eng Seng Corp (CHIP SP), Uzabase Inc (3966 JP), PTB Group Ltd (PTB AU).
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