In today’s briefing:
- CHINA’S AI COMMODITIZATION: Can Global AI Valuations Survive?
- NPS Could Raise Allocation of Korean Stocks = KOSPI to 5,000 Soon
- Oil futures: Crude recovers from lows, refining margins lift gloom
- Poor Affordability and Structural Issues Take Their Toll on US Housing
- Actinver Research – Consumer Post 3Q25 Update
- Thailand Politics: Upcoming Polls Opens Window To Resolving Political Deadlock
- Actinver Research – Real Estate Post 3Q25 Update
- Asia base oils demand outlook: Week of 10 November
- Asia base oils supply outlook: Week of 10 November
- Malaysia’s Glove Sector Gradually Recovers Amid Trade Shifts
CHINA’S AI COMMODITIZATION: Can Global AI Valuations Survive?
- Chinese AI model downloads have surpassed those of the U.S. putting at risk the valuations of the large hyperscalers in the U.S.
- Chinese open-source AI models offer a more secure, efficient, and lower cost alternative to Chat GPT -5 , Claude 4.5 Sonnet, and other U.S. LLMs.
- We believe that there will be a turning point when investors will realize that the Chinese open-source AI models have undercut the premise of U.S. global dominance of AI.
NPS Could Raise Allocation of Korean Stocks = KOSPI to 5,000 Soon
- One of the biggest stories in the Korean stock market in the past several weeks has been the discussions about NPS potentially increasing the allocation of Korean stocks.
- If NPS announces a meaningful increase in the allocation of Korean stocks for its AUM, then there could certainly be an acceleration to KOSPI reaching 5,000.
- Based on what we have gathered so far, there is a higher probability (70-80%) that NPS meaningfully increases the allocation of Korean stocks in the next several months.
Oil futures: Crude recovers from lows, refining margins lift gloom
- Crude oil futures nudged higher Friday but were heading for a second week of losses, albeit modest, with the market unable to shake off the gloom surrounding predictions of a massive oversupply in Q1.
- Front-month Jan25 ICE Brent futures were trading at $63.72/b (2005 GMT) versus Thursday’s settle of $63.38/b, while Dec25 NYMEX WTI was at $59.84/b against a previous close of $59.53/b.
- The oversupply narrative amid soaring supplies and tepid demand growth has taken hold of markets this week, overshadowing geopolitical concerns.
Poor Affordability and Structural Issues Take Their Toll on US Housing
- Falling mortgage rates during 2025 have imparted a limited impact on housing activity. Rates are higher than recent historic lows, blunting channels through which lower mortgage rates benefit economic activity.
- Poor affordability has been a headwind for housing in recent years., particularly since 2022. Rising home prices have made renting more affordable, notwithstanding supply shortages of desired housing stock.
- Rising numbers of smaller households have boosted demand for smaller properties, but developers have been slow to respond to the shift by retaining a trading-up strategy in core urban areas.
Actinver Research – Consumer Post 3Q25 Update
- In the midst of the soft top-line performance, management remains cautious, expecting more cost and Capex efficiencies, and a tough consumer environment with consumers remaining more selective as in previous quarters.
- Still, most companies reiterated their FY25 guidance, with Bimbo an exception amid different FX conditions vs previously forecasted, and with Chedraui expecting downside risks at the top-line level.
- Within Food & Bev, we continue to prefer AC, KOF, FEMSA and Becle (all Outperform). With no major PT changes, we continue to expect these players to outperform peers despite volume pressure and the excise taxes planned for next year.
Thailand Politics: Upcoming Polls Opens Window To Resolving Political Deadlock
- The once-tiny Bhumjaithai Party has leveraged off shifting political dynamics such as the Pheu Thai Party’s decline to emerge as the most powerful power broker in the country.
- Hence, the coming election could break the 21-year old political deadlock by enabling a new political alignment that is better able to devise a fundamental political resolution.
- Such a resolution will allow a less distracted political class to tackle Thailand’s deep challenges, revive a moribund economy, and so escape the middle-income trap.
Actinver Research – Real Estate Post 3Q25 Update
- We continue to observe mixed performance across our Real Estate coverage.
- Industrial Real Estate companies once again delivered solid operational results —a trend we expect to persist— supported by ongoing development activity, and stable, inflation-linked revenues from their stabilized portfolios.
- Despite continued uncertainty surrounding trade relations and tariffs, renewal rate growth remains robust across our covered names, while vacancy rates remain below 6%, underscoring the sector’s resilience.
Asia base oils demand outlook: Week of 10 November
- Asia’s base oils demand likely to stay muted.
- Expectations of healthy availability of supply and seasonal slowdown in demand curb urgency to lock in additional volumes.
- Seasonal slowdown could limit immediate impact of any adjustment in base oils output because of lower margins.
Asia base oils supply outlook: Week of 10 November
- Asia’s base oils prices extend steep fall vs gasoil prices.
- Weaker outright prices compound the drop.
- Sliding price-differentials, combined with increasingly firm diesel premium to crude oil, increase pressure on refiners to adjust output in response.
Malaysia’s Glove Sector Gradually Recovers Amid Trade Shifts
- Glove demand rebounds as inventories normalize
- US tariffs boost Malaysian manufacturers’ market share
- Automation drives efficiency, supporting margin recovery
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