Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>On 5 September, <a href="https://www.smartkarma.com/entities/jfe-holdings-inc" target="_blank" data-smartkarma-citation="entities:210:1" rel="noopener">JFE Holdings (5411 JP)</a> saw an article out of a capital raising. It was confirmed later in the day. Huge volumes traded. The stock fell sharply.</li>
<li>The offering supply/demand dynamics are.... complicated. The offering is to foreign instos. The net demand is probably mostly retail and index, and positioning is... also complicated.</li>
<li>The EPS dilution is already accounted for. The fall against Nippon Steel pretty much does it after considering the discount expected. </li>
</ul>


On 5 September, JFE Holdings (5411 JP) saw an article out of a capital raising. It was confirmed later in the day. Huge volumes traded. The stock fell sharply.
The offering supply/demand dynamics are.... complicated. The offering is to foreign instos. The net demand is probably mostly retail and index, and positioning is... also complicated.
The EPS dilution is already accounted for. The fall against Nippon Steel pretty much does it after considering the discount expected. 


JFE Holdings (5411) - Volume Patterns Indicate Possible Squeeziness

APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/jfe-holdings-inc" target="_blank" data-smartkarma-citation="entities:210:1" rel="noopener">JFE Holdings (5411 JP)</a> is looking to raise around US$870m to fund its capacity expansion plans. Together with the offering, it will undertake a US$610m CB issuance.</li>
<li>The deal appears to be well flagged with the firm disclosing its JV and other related CapEx plans in its earlier earnings announcement.</li>
<li>Overall, the new shares would result in a 8.2% dilution and represent 12 days of three month ADV.</li>
</ul>



JFE Holdings (5411 JP) is looking to raise around US$870m to fund its capacity expansion plans. Together with the offering, it will undertake a US$610m CB issuance.
The deal appears to be well flagged with the firm disclosing its JV and other related CapEx plans in its earlier earnings announcement.
Overall, the new shares would result in a 8.2% dilution and represent 12 days of three month ADV.


JFE Holdings Placement - Well Flagged, but Would Probably Need a Wider Correction

Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>OVERSEAS. US LABOR DAY HOLIDAY. With US out, No leaders in Global Equities; European shares closed flat on thin Volumes;  China's measures to support Property market taking hold. </li>
<li>JAPAN.US Markets Off. NKY Futs vs Cash -0.1%; USDJPY 146.5; Nikkei Rebal: Mercari, Lasertec, Nitori ADDED; Nippon Sheet Glass, Mitsui E&amp;S, Matsui Sec OUT; JFE 200bn Equity/CB raising  </li>
<li>JAPAN X: JFE Holdings Plans to Raise ¥200 Billion for Carbon Emissions Reduction Efforts. Still need clarity willingness of customers to accept "green pricing".  Watch Nippon Steel and Kobe Steel. </li>
</ul>


OVERSEAS. US LABOR DAY HOLIDAY. With US out, No leaders in Global Equities; European shares closed flat on thin Volumes;  China's measures to support Property market taking hold. 
JAPAN.US Markets Off. NKY Futs vs Cash -0.1%; USDJPY 146.5; Nikkei Rebal: Mercari, Lasertec, Nitori ADDED; Nippon Sheet Glass, Mitsui E&amp;S, Matsui Sec OUT; JFE 200bn Equity/CB raising  
JAPAN X: JFE Holdings Plans to Raise ¥200 Billion for Carbon Emissions Reduction Efforts. Still need clarity willingness of customers to accept "green pricing".  Watch Nippon Steel and Kobe Steel. 


Ohayo Japan| Lack of Direction with US Closed; JAPAN X: JFE to Raise ¥200bn for Green Steel Drive

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

iShares MSCI ACWI ETF / Technical Analysis

<ul>
<li>Global equities are under some pressure after Fitch downgraded the United States' credit rating to AA+ from AAA.</li>
<li>We expect that this is a normal 3%-6% pullback to the 50-day MA or major $93 support level on the MSCI ACWI <a href="https://www.smartkarma.com/entities/ishares-msci-acwi-etf" target="_blank" data-smartkarma-citation="entities:24402:1" rel="noopener">iShares MSCI ACWI ETF (ACWI US)</a> .</li>
<li>$TNX is below 4.1%-4.3% and DXY remains in an 8-month downtrend; as long as this remains true, we'd buy on a pullback to the 50-day MA and/or $93 on ACWI-US</li>
</ul>


Global equities are under some pressure after Fitch downgraded the United States' credit rating to AA+ from AAA.
We expect that this is a normal 3%-6% pullback to the 50-day MA or major $93 support level on the MSCI ACWI iShares MSCI ACWI ETF (ACWI US) .
$TNX is below 4.1%-4.3% and DXY remains in an 8-month downtrend; as long as this remains true, we'd buy on a pullback to the 50-day MA and/or $93 on ACWI-US


Normal Pullback, or Something More?; Watching Resistance on DXY and 10-Yr Treasury Yield; Value Buys

Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

<ul>
<li>Lucror Analytics' ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).</li>
<li>We assess Usiminas' ESG as "Adequate", reflecting its "Adequate" scores for the Environmental, Social and Governance pillars. Controversies are "Immaterial" and Disclosure is "Strong".</li>
<li>Usinas Siderurgicas de Minas Gerais SA (Usiminas) is one of Brazil’s largest steel-makers. The company's key flat-steel production and iron-ore mining business units together account for the bulk of consolidated EBITDA.</li>
</ul>


Lucror Analytics' ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Usiminas' ESG as "Adequate", reflecting its "Adequate" scores for the Environmental, Social and Governance pillars. Controversies are "Immaterial" and Disclosure is "Strong".
Usinas Siderurgicas de Minas Gerais SA (Usiminas) is one of Brazil’s largest steel-makers. The company's key flat-steel production and iron-ore mining business units together account for the bulk of consolidated EBITDA.


Japan

Nippon Steel Corp is an integrated steel maker. The Company produces various types of steel products used for industrial machinery & equipment and exports them worldwide.  Nippon Steel provides plant construction and urban development and also develops new businesses such as chemicals, ceramics, electronic equipment and information & communication systems.

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Nippon Steel Corporation (5401 JP)

JFE Holdings (5411) - Volume Patterns Indicate Possible Squeeziness

JFE Holdings fell sharply after a capital raising announcement. Supply/demand is complicated. Foreign instos are asked to buy. Retail buys in the...

Travis Lundy

JFE Holdings Placement - Well Flagged, but Would Probably Need a Wider Correction

JFE Holdings (5411 JP) is looking to raise around US$870m to fund its capacity expansion plans. Together with the offering, it will undertake a...

Clarence Chu

Ohayo Japan| Lack of Direction with US Closed; JAPAN X: JFE to Raise ¥200bn for Green Steel Drive

US Markets Off. NKY Futs vs Cash -0.1%; USDJPY 146.5; Nikkei Rebal: Mercari, Lasertec, Nitori ADDED; Nippon Sheet Glass, Mitsui E&S, Matsui Sec...

Mark Chadwick

Normal Pullback, or Something More?; Watching Resistance on DXY and 10-Yr Treasury Yield; Value Buys

Normal Pullback, or Something More for global equities?; Watch Resistance on $DXY and 10-Yr Treasury Yield; Value Buys in Consumer Discretionary...

Vermilion Research

Usiminas - ESG Report - Lucror Analytics

Lucror Analytics' ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable). We assess Usiminas' ESG as...

Lucror Analytics

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JFE Holdings (5411) - Volume Patterns Indicate Possible Squeeziness

​JFE Holdings fell sharply after a capital raising announcement. Supply/demand is complicated. Foreign instos are asked to buy. Retail buys in the...

Travis Lundy

JFE Holdings Placement - Well Flagged, but Would Probably Need a Wider Correction

JFE Holdings (5411 JP) is looking to raise around US$870m to fund its capacity expansion plans. Together with the offering, it will undertake a...

Clarence Chu

Ohayo Japan| Lack of Direction with US Closed; JAPAN X: JFE to Raise ¥200bn for Green Steel Drive

US Markets Off. NKY Futs vs Cash -0.1%; USDJPY 146.5; Nikkei Rebal: Mercari, Lasertec, Nitori ADDED; Nippon Sheet Glass, Mitsui E&S, Matsui Sec...

Mark Chadwick

Normal Pullback, or Something More?; Watching Resistance on DXY and 10-Yr Treasury Yield; Value Buys

Normal Pullback, or Something More for global equities?; Watch Resistance on $DXY and 10-Yr Treasury Yield; Value Buys in Consumer Discretionary...

Vermilion Research

Usiminas - ESG Report - Lucror Analytics

Lucror Analytics' ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable). We assess Usiminas' ESG as...

Lucror Analytics

JFE Holdings fell sharply after a capital raising announcement. Supply/demand is complicated. Foreign instos are asked to buy. Retail buys in the...