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 China ETF / Technical Analysis

<ul>
<li>We remain neutral on global equities (MSCI ACWI), we believe upside remains limited with the MSCI ACWI (ACWI-US), S&amp;P 500, and several European indexes still below major resistance.</li>
<li>We continue to expect rangebound price action in the months ahead on the MSCI ACWI.</li>
<li>And, rangebound price action could very well be the theme for all of 2023 (with resistance at $93 and support at $75-77 on ACWI-US)</li>
</ul>


We remain neutral on global equities (MSCI ACWI), we believe upside remains limited with the MSCI ACWI (ACWI-US), S&amp;P 500, and several European indexes still below major resistance.
We continue to expect rangebound price action in the months ahead on the MSCI ACWI.
And, rangebound price action could very well be the theme for all of 2023 (with resistance at $93 and support at $75-77 on ACWI-US)


Hang Seng and MSCI China Bottoming -- Add; Europe Still Leading; Shift From U.S. To Non-U.S.

Bond market data and technology, BondEvalue

BondEvalue

Bond market data and technology

BondEvalue is a Singapore-based Fintech that specializes in bond market data and technology. The company's information services business offers bond market data on hard-currency corporate & sovereign bonds across Asia, Middle East, Europe and the Americas. The data, which includes bond prices, yields, news and analytics, is offered to end investors via interactive Mobile and Web Apps. Investors can sign up for a free trial of the service either via the company's website (https://bondevalue.com) or by downloading the BondEvalue Mobile App (http://onelink.to/wej7jq). BondEvalue is also developing an electronic bond exchange, BondbloX in Singapore that allows investors to trade bonds electronically in smaller sizes (US$1,000 or equivalent). For more information, visit https://www.bondblox.com/

Bond Market Data and Technology

Credit

BNP Paribas reported a jump in its annual 2021 profits by 34.3% to €9.5bn ($10.9bn). The group’s revenues rose 4.4% to €46.2bn ($52.8bn). Profits were helped by its cost of risk falling 49% through the year to €2.9bn ($3.3bn) alongside a sharp 46% rise in operating income to €12.2bn ($13.9bn). Its cost of risk (Term of the Day, explained here) dropped due to the limited number of new defaults and a high basis of comparison with respect to 2020. Growth was visible across its domestic, international financial services, and investment banking divisions. BNP Paribas lifted its shareholder payout target to 60% of profits via a combination of cash dividends and share buybacks as compared to its prior 50% policy. Its CET1 ratio stood at 12.9% as of end-December 2021, up 10bp YoY.

BNP Paribas’ Profits Jump, To Lift Payout Target

China Petroleum & Chemical / Technical Analysis

<ul>
<li>In last week's Int'l Compass (Jan. 27) we highlighted that the broad global indexes were breaking down, but that we were watching for potential false breakdowns.</li>
<li>We are now getting those false breakdowns as major levels have been reclaimed; we view this as a net positive.</li>
<li>We continue to see select areas that are attractive (namely cyclical value and defensive Sectors) and we expect markets to remain mixed.</li>
</ul>


In last week's Int'l Compass (Jan. 27) we highlighted that the broad global indexes were breaking down, but that we were watching for potential false breakdowns.
We are now getting those false breakdowns as major levels have been reclaimed; we view this as a net positive.
We continue to see select areas that are attractive (namely cyclical value and defensive Sectors) and we expect markets to remain mixed.


False Breakdowns on Global MSCI Indexes as the US Dollar Weakens; Ideas Within Energy & Financials

<ul>
<li>Commodities (ex. precious metals) and global yields are on the rise as the US dollar (DXY) deteriorates. Additionally, EM equities (EEM-US) display a bullish RS reversal relative to MSCI ACWI. </li>
<li>These are all important risk-on signals for global equities that continue to support our neutral yet constructive outlook. We expect more consolidation and mixed markets ahead.</li>
<li>Two Sectors that stand to benefit most from rising rates include Energy and Financials. We recommend adding exposure to these Sectors as we see a shift in favor of value.</li>
</ul>


Commodities (ex. precious metals) and global yields are on the rise as the US dollar (DXY) deteriorates. Additionally, EM equities (EEM-US) display a bullish RS reversal relative to MSCI ACWI. 
These are all important risk-on signals for global equities that continue to support our neutral yet constructive outlook. We expect more consolidation and mixed markets ahead.
Two Sectors that stand to benefit most from rising rates include Energy and Financials. We recommend adding exposure to these Sectors as we see a shift in favor of value.


Value Sectors Take The Lead On Rising Global Yields; Buying Energy and Financials

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

Equity Bottom-Up

Mitsubishi UFJ Financial (MUFG) / Equity Bottom-Up

*For Sale: According to press reports, Mitsubishi UFJ Financial Group (8306.JP) [MUFG] is contemplating a sale of its US banking subsidiary, MUFG Americas – the 22nd largest bank in the US by assets, in a significant strategy shift;  and  *Don’t Expect A Big Premium: Bloomberg suggests that the median sale price for large US banks was approximately 1.4x P/BV last year – implying a deal price of over USD 22 bn. In addition to the price tag limiting the number of potential suitors, any acquirer will have to contend with breaching the national deposit cap. As such, pricing likely would below last year’s US average – particularly considering MUFG America’s fundamental challenges.

*For Sale: According to press reports, Mitsubishi UFJ Financial Group (8306.JP) [MUFG] is contemplating a sale of its US banking subsidiary, MUFG Americas – the 22nd largest bank in the US by assets, in a significant strategy shift;  and  *Don’t Expect A Big Premium: Bloomberg suggests that the median sale price for large US banks was approximately 1.4x P/BV last year – implying a deal price of over USD 22 bn. In addition to the price tag limiting the number of potential suitors, any acquirer will have to contend with breaching the national deposit cap. As such, pricing likely would below last year’s US average – particularly considering MUFG America’s fundamental challenges.

Mitsubishi UFJ Financial Group – US Exit

France

BNP Paribas S.A. attracts deposits and offers commercial, retail, investment, private and corporate banking services.  The Bank also provides asset management and investment advisory services to institutions and individuals in Europe, the United States, Asia and the Emerging Markets.

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BNP Paribas (BNP FP)

Hang Seng and MSCI China Bottoming -- Add; Europe Still Leading; Shift From U.S. To Non-U.S.

We remain neutral on global equities $ACWI and expect rangebound price action in the months (possibly year) ahead. Specific $ACWI trading range we...

Vermilion Research

BNP Paribas’ Profits Jump, To Lift Payout Target

BNP Paribas reported a jump in its annual 2021 profits by 34.3% to €9.5bn ($10.9bn). The group’s revenues rose 4.4% to €46.2bn ($52.8bn). Profits...

BondEvalue

False Breakdowns on Global MSCI Indexes as the US Dollar Weakens; Ideas Within Energy & Financials

Global sovereign bond yields remain on an upward trajectory, with 10-year yields hitting multi-year highs this week in many countries; we expect...

Vermilion Research

Value Sectors Take The Lead On Rising Global Yields; Buying Energy and Financials

Two Sectors that stand to benefit most from rising rates include Energy and Financials. We recommend adding exposure to these Sectors as we see a...

Vermilion Research

Mitsubishi UFJ Financial Group – US Exit

MUFG: MUFG is contemplating the sale of its US banking subsidiary. In addition to the price tag limiting the number of suitors, so will breaching a...

Thomas J. Monaco

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