Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

Equity Bottom-Up

<ul>
<li>We believe the first-day rush is just a one-time event.</li>
<li>We believe Costco can hardly survive the market in China.</li>
<li>Almost supermarkets are losing money in China.</li>
<li>We believe Large-area supermarkets are far from customers’ needs.</li>
</ul>


We believe the first-day rush is just a one-time event.
We believe Costco can hardly survive the market in China.
Almost supermarkets are losing money in China.
We believe Large-area supermarkets are far from customers’ needs.


Costco Wholesale (COST): Concerns Behind First-Day Crowd in China

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

The “Big” rally has now faded less than a week from its start. While many point to a robust economy, strong GDP, and a strengthening U.S. dollar as the bellwether of global currencies, something seems amiss. Higher interest rates have doused the market’s advance, with 10-year yields double what they once were just three years ago. Investors are being jostled about as a determination is made as to whether the Fed has gone too far and too fast. Our concern here is that the Fed is creating a conundrum, indicating that higher rates are still forthcoming despite what we, and the market, are viewing as the possible end of the bull market...In our November Strategy publication, we outline a host of indicators we are watching for signs of the market's health.  In addition we highlight a number of actionable setups within Health care, Consumer Staples and Technology.

The “Big” rally has now faded less than a week from its start. While many point to a robust economy, strong GDP, and a strengthening U.S. dollar as the bellwether of global currencies, something seems amiss. Higher interest rates have doused the market’s advance, with 10-year yields double what they once were just three years ago. Investors are being jostled about as a determination is made as to whether the Fed has gone too far and too fast. Our concern here is that the Fed is creating a conundrum, indicating that higher rates are still forthcoming despite what we, and the market, are viewing as the possible end of the bull market...In our November Strategy publication, we outline a host of indicators we are watching for signs of the market's health.  In addition we highlight a number of actionable setups within Health care, Consumer Staples and Technology.

U.S. Equity Strategy & Sector Commentaries: Defensive Sectors Leading = Unhealthy Market

Silver Point

Thomas J. Monaco

Independent Insight Provider

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

* Smooth European Integration: Visa Europe accretion is expected to increase to high-single digits by 2020, reflecting Visa’s (V.US) repricing initiative, integration efforts, and market penetration strategies - which are posting positive results much faster than anticipated.*Comps Getting Easier: On top of the positive impact from the Trump administration’s tax reform plan, bottom-line results at the legacy Visa franchise are getting easier: strong margins of 68%, strong US payment volume…

* Smooth European Integration: Visa Europe accretion is expected to increase to high-single digits by 2020, reflecting Visa’s (V.US) repricing initiative, integration efforts, and market penetration strategies - which are posting positive results much faster than anticipated.*Comps Getting Easier: On top of the positive impact from the Trump administration’s tax reform plan, bottom-line results at the legacy Visa franchise are getting easier: strong margins of 68%, strong US payment volume…

Visa – European Acquisition Continues to Surprise

MSCI Emerging Markets Index / Technical Analysis

Big-picture technicals offer a compelling outlook for equities -- in the long-run. Despite arguably stretched trends, especially in the U.S. and EM, one indicator in particular keeps us optimistic: monthly charts.  What is clear right now is: (1) Europe is on the doorstep of breaking above secular resistance; (2) Japan is breaking out above secular resistance; (3) and EM already has. Speaking of EM, we view this as the place to be, or overweight, in 2018. The EM/EAFE’s 20-year chart (below) reveals an in-progress trend reversal (which developed at a secular trendline) in favor of EM.In today’s report we review every global sector, highlighting actionable stocks within each.

Big-picture technicals offer a compelling outlook for equities -- in the long-run. Despite arguably stretched trends, especially in the U.S. and EM, one indicator in particular keeps us optimistic: monthly charts.  What is clear right now is: (1) Europe is on the doorstep of breaking above secular resistance; (2) Japan is breaking out above secular resistance; (3) and EM already has. Speaking of EM, we view this as the place to be, or overweight, in 2018. The EM/EAFE’s 20-year chart (below) reveals an in-progress trend reversal (which developed at a secular trendline) in favor of EM.In today’s report we review every global sector, highlighting actionable stocks within each.

Asean-focused. Ex-Head of Thai Research

Athaporn Arayasantiparb, CFA

Thematic (Sector/Industry)

According to a report on the AEC integration framework prepared in Indonesia, Thailand has the second highest per capita consumption of drugs and supplements in the region after Singapore. They noted that the average Thai consumes double that of the average Filipino and triple the Indonesian levels. This is pretty interesting, because while income levels here is the highest of the three TIP nations, we are still roughly at the same development stages.Not many Thai-listed companies operate in…

According to a report on the AEC integration framework prepared in Indonesia, Thailand has the second highest per capita consumption of drugs and supplements in the region after Singapore. They noted that the average Thai consumes double that of the average Filipino and triple the Indonesian levels. This is pretty interesting, because while income levels here is the highest of the three TIP nations, we are still roughly at the same development stages.Not many Thai-listed companies operate in…

United States

Costco Wholesale Corporation operates wholesale membership warehouses in multiple countries.  The Company sells all kinds of food, automotive supplies, toys, hardware, sporting goods, jewelry, electronics, apparel, health and beauty aids, as well as other goods.

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Costco Wholesale (COST US)

Costco Wholesale (COST): Concerns Behind First-Day Crowd in China

We believe the first-day rush is just a one-time event. We believe Costco can hardly survive the market in China. Almost supermarkets are losing...

Ming Lu

U.S. Equity Strategy & Sector Commentaries: Defensive Sectors Leading = Unhealthy Market

The “Big” rally has now faded less than a week from its start. While many point to a robust economy, strong GDP, and a strengthening U.S. dollar as...

Vermilion Research

Visa – European Acquisition Continues to Surprise

* Smooth European Integration: Visa Europe accretion is expected to increase to high-single digits by 2020, reflecting Visa’s (V.US) repricing...

Thomas J. Monaco

Global Equity Strategy: Overweight EM

Big-picture technicals offer a compelling outlook for equities -- in the long-run. Despite arguably stretched trends, especially in the U.S. and...

Vermilion Research

Skirmish on the Supplement Aisle

According to a report on the AEC integration framework prepared in Indonesia, Thailand has the second highest per capita consumption of drugs and...

Athaporn Arayasantiparb, CFA

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