Chief Economist, Heteronomics

Phil Rush

Chief Economist

Heteronomics

Heteronomics represents a different kind of economics. We believe analysis should delve into the details of what is really going on, rather than using overly simplistic assumptions to quick-sell stories. Independence from myopic institutional pressures allows us to focus on the realities underlying your asset allocation decisions, without the conflicts of the old market structures. Heteronomics targets the themes driving UK asset prices, offering the benefits of depth, independence and ultimately price.

UK-centric macro research

Macroeconomics

<ul><li>The Euro has weakened over the past week due to markets focusing on hawkish price and wage inflation, with more emphasis on activity growth rates and PMIs than on unemployment and underlying inflationary pressures.</li><li>The Flash HICP for November may not rise as expected due to base effects such as German package holidays, which is considered a temporary blip.</li><li>Despite most data warning against a 50bp cut, the RBNZ is likely to make this cut again, positioning it as an outlier.</li></ul>

The Euro has weakened over the past week due to markets focusing on hawkish price and wage inflation, with more emphasis on activity growth rates and PMIs than on unemployment and underlying inflationary pressures.The Flash HICP for November may not rise as expected due to base effects such as German package holidays, which is considered a temporary blip.Despite most data warning against a 50bp cut, the RBNZ is likely to make this cut again, positioning it as an outlier.

Equity Capital Markets and Advisory Business, Auctus Advisors

Auctus Advisors

Equity Capital Markets and Advisory Business

Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector. The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy. Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors. Auctus provides Corporate Broking, Equity Research and Investment Banking services.

Thematic (Sector/Industry)

<ul>
<li>ADX Energy (ADX AU) C : Portion of deeper target at Welchau flows water on test – Two intervals (total of ~16 m) in the Steinalm formation were tested at a stable rate (natural flow) of 240-290 bbl/d of drilling mud, likely contaminated formation water and some oil traces.</li>
<li>Gas was initially observed at surface. While the achieved flow rate highlights the high permeability of the natural fractures, the absence of hydrocarbons is disappointing and surprising given the results of the logs, the inflow of gas while drilling, the analysis of the retrieved cores (with indication of hydrocarbons) and the fact that oil samples were recovered from this interval.</li>
<li>The well is now being flowed while ADX is running a downhole production logging tool to analyse the contribution of the various sections of the well to flow. </li>
</ul>


ADX Energy (ADX AU) C : Portion of deeper target at Welchau flows water on test – Two intervals (total of ~16 m) in the Steinalm formation were tested at a stable rate (natural flow) of 240-290 bbl/d of drilling mud, likely contaminated formation water and some oil traces.
Gas was initially observed at surface. While the achieved flow rate highlights the high permeability of the natural fractures, the absence of hydrocarbons is disappointing and surprising given the results of the logs, the inflow of gas while drilling, the analysis of the retrieved cores (with indication of hydrocarbons) and the fact that oil samples were recovered from this interval.
The well is now being flowed while ADX is running a downhole production logging tool to analyse the contribution of the various sections of the well to flow. 


India Equity Analyst - Fundamental & Thematic, Beat the Street

Sudarshan Bhandari

India Equity Analyst - Fundamental & Thematic

Beat the Street

Beat The Street was founded by Nimish Maheshwari and Sudarshan Bhandari, both of whom are Chartered Accountants by Profession, known for their expert analysis in the fields of Business, Sectoral analysis, and Corporate governance.

With a strong social media presence of 45,000+ Subscribers across various platforms, they are considered trusted voices in the industry. Their insights and analysis have been featured in some of India’s most prominent publications, including the Economic Times, Dalal Street Investment Journal, The Morning Context, and The Ken.

Their analysis on Bankrupt & Insolvent companies has been instrumental in saving investors from significant losses. They have a keen eye for identifying red flags and has identified exclusive redflags earlier in Vedanta, Nykaa, Dhani Services, Adani and many more.

Read Business Not Stock Prices

<ul>
<li>Big Tech companies are already generating significant revenue from AI. Microsoft expects to reach $10 billion in AI revenue by the next quarter, making it their fastest-growing area.</li>
<li>In the third quarter of 2024 alone <strong>Microsoft, Google, and Meta</strong> collectively spent over $42 billion on AI infrastructure, primarily on building data centers and purchasing computing equipment.</li>
<li>Companies are projecting continued high spending on AI into 2025 to meet growing demand. However, challenges remain, including supply constraints for AI chips</li>
</ul>


Big Tech companies are already generating significant revenue from AI. Microsoft expects to reach $10 billion in AI revenue by the next quarter, making it their fastest-growing area.
In the third quarter of 2024 alone Microsoft, Google, and Meta collectively spent over $42 billion on AI infrastructure, primarily on building data centers and purchasing computing equipment.
Companies are projecting continued high spending on AI into 2025 to meet growing demand. However, challenges remain, including supply constraints for AI chips


Thematic Report: AI Wave- Big Tech's Spending Spree

<ul><li>Upwards revisions to Euro area labour costs and a jump in negotiated wage settlements extend cost growth inconsistent with a sustainable return to the 2% inflation target.</li><li>The ECB hopes this will subside swiftly in 2025, with productivity growth and squeezed profit margins helping contain inflation. But these hopes seem set to be disappointed.</li><li>Persistent wage pressures should prevent a 50bp rate cut in December and limit further cuts. Less dovish fundamentals feed bullish Euro seasonality, magnified by positioning.</li></ul><p></p>

Upwards revisions to Euro area labour costs and a jump in negotiated wage settlements extend cost growth inconsistent with a sustainable return to the 2% inflation target.The ECB hopes this will subside swiftly in 2025, with productivity growth and squeezed profit margins helping contain inflation. But these hopes seem set to be disappointed.Persistent wage pressures should prevent a 50bp rate cut in December and limit further cuts. Less dovish fundamentals feed bullish Euro seasonality, magnified by positioning.

Semiconductor & Technology Specialist, Ingenuity

William Keating

Semiconductor & Technology Specialist

Ingenuity

Our focus is exclusively on in-depth research & consulting in the broader semiconductor industry. We focus on the key players, namely Intel, Micron, Qualcomm, Apple, Samsung, NVIDIA, AMD, TSMC & Global Foundries - as well as some of the lesser known, but nonetheless critical, companies such as ASML (for EUV), Mellanox, Cavium, Xilinx etc. We specialise in their products, roadmaps, process technologies, competitive advantages & threats etc. We also help our clients understand the implications of new and emerging technologies, e.g. 3D X-Point, 3D NAND, Carbon Nanotubes, Autonomous Driving, Graphene, Silicon Photonics, Wafer-Level Optics, Artificial Intelligence, FPGA, GPU, ASIC etc. 

Semiconductor Analysis & Research

<ul>
<li>Revenues of $7.05 billion were marginally higher than midpoint of $6.93 billion, up 4% QoQ and up 5% YoY.  Guided current quarter at $7.15 billion +1.5% QoQ , +10.5% YoY</li>
<li>Most WFE share prices have retreated to early 2022 levels, matching with when annual revenues first exceeded the $100 billion level</li>
<li>After a 44% growth spurt in 2021, we have had three years with mostly no growth. We expect the same in 2025. Invest accordingly</li>
</ul>


Revenues of $7.05 billion were marginally higher than midpoint of $6.93 billion, up 4% QoQ and up 5% YoY.  Guided current quarter at $7.15 billion +1.5% QoQ , +10.5% YoY
Most WFE share prices have retreated to early 2022 levels, matching with when annual revenues first exceeded the $100 billion level
After a 44% growth spurt in 2021, we have had three years with mostly no growth. We expect the same in 2025. Invest accordingly


For Its WFE Q324 Season Finale, AMAT Returns ASML's Favour & Sinks Semis Yet Again