Transport Sector, China and Asia-focused Research

Charles De Trenck

Thematic (Sector/Industry)

<p>I was working on a bigger piece on HK vs Singapore which I will put out later, and reviewing political classifications of economies, when I saw a good comment from Ray Dalio on Trump and his invocation of Ayn Rand. I was also in the middle of reading the history of Athens and re-reading Aristotle’s Constitution of Athens, which added perspective to Dalio. There is a lot to apply to today which I think is worth noting.</p><p>Quick conclusions before delving deeper:</p><ul><li>Ray Dalio is right to invoke Ayn Rand and flag the positives Trump could bring about;</li><li>But Let’s also keep in mind how deep the recent hole banks, Bernanke and Obama dug;</li><li>Looking at Aristotle as well, we might say that Trump’s partial democratic election has been to install an Aristocracy…this will certainly be interesting;</li><li>There are some really good free reads to turn to for a quick study of Ayn Rand;</li><li>When we listen back to Ayn Rand, we see that she disliked MNCs/Corporations because of their manipulation of government…Let’s see where Trump takes this.</li></ul>

I was working on a bigger piece on HK vs Singapore which I will put out later, and reviewing political classifications of economies, when I saw a good comment from Ray Dalio on Trump and his invocation of Ayn Rand. I was also in the middle of reading the history of Athens and re-reading Aristotle’s Constitution of Athens, which added perspective to Dalio. There is a lot to apply to today which I think is worth noting.Quick conclusions before delving deeper:Ray Dalio is right to invoke Ayn Rand and flag the positives Trump could bring about;But Let’s also keep in mind how deep the recent hole banks, Bernanke and Obama dug;Looking at Aristotle as well, we might say that Trump’s partial democratic election has been to install an Aristocracy…this will certainly be interesting;There are some really good free reads to turn to for a quick study of Ayn Rand;When we listen back to Ayn Rand, we see that she disliked MNCs/Corporations because of their manipulation of government…Let’s see where Trump takes this.

Trump Not Likely to Halt Decline of US. But Ray Dalio Makes Good Case in Bringing Back Ayn Rand

Founder and Strategist, Entext Economics & Strategy

Sean Maher

Founder and Strategist

Entext Economics & Strategy

Entext provides institutional investors with distinctive, actionable asset allocation and thematic research, which typically challenges the market consensus. Our clients range from credit, equity and multi-asset hedge and pension funds to family offices and sovereign funds. 
 
We focus on identifying key inflection points in macro data and relative asset performance amid the 'groupthink'  and confirmation bias that characterizes most investment bank analysis.

Macro Driven Investment Insight

<ul>
<li><span lang="EN-US">The overwhelming investor consensus a year ago was for further EM/commodity downside amid deflation fears - this year it is a USD secular bull and global reflation; positioning has shifted accordingly.</span></li>
<li><div>The value over momentum positioning advocated all year has paid off dramatically - globally, value has outperformed by about 20 ppts since July, the second-best run versus quality in almost 40 years.</div></li>
<li><div>Calling the oil market right in 2016 was critical to everything else in asset allocation including…</div></li>
</ul>


The overwhelming investor consensus a year ago was for further EM/commodity downside amid deflation fears - this year it is a USD secular bull and global reflation; positioning has shifted accordingly.
The value over momentum positioning advocated all year has paid off dramatically - globally, value has outperformed by about 20 ppts since July, the second-best run versus quality in almost 40 years.
Calling the oil market right in 2016 was critical to everything else in asset allocation including…


2017 Asset Allocation Outlook – Part 2: Trump Reflation Euphoria to Fade?

Equity Research Analyst, Maritime sector, Drewry Maritime Financial Research

Ankush Kathuria CFA, FRM

Equity Research Analyst, Maritime sector

Maritime Sector, Equity & Credit Research

Drewry Maritime Financial Research

With no ties to other players in the shipping, finance or banking world, we provide a uniquely impartial view of the markets and companies we cover. Our parent organization, Drewry is a leading independent provider of research services to the maritime and shipping industry, employing over 100 professionals across an international network of offices in London, Delhi, Singapore and Shanghai. Combining our market-leading resources with seasoned sector expertise DFRS offers a highly differentiated and comprehensive range of investment and financial research services to lenders and prospective investors in publicly listed maritime and shipping companies. The full service of reports, supporting resources and sector orientated webinars provides our clients with the most complete picture of the organisations under coverage as is possible. We have been charting and analysing the world’s maritime markets for more than 40 years. This unrivalled intelligence and understanding provides the foundation of our research service. Our analysts have access to one of the most up-to-date, comprehensive and reliable sources of market insight and research data available today. We look at globally listed companies within the following sectors: Port Operators, Container Shipping, Container Manufacturing & Leasing, LNG Shipping, Dry Bulk Shipping and Tanker Shipping. Combine in-depth sector expertise with financial analysis focusing on over 50 stocks globally.

<p><strong>🎺🎺🎺 The Maritime Honours List 2016 🎺🎺🎺<br></strong></p><p><em>As we near the end of the year, global markets are on a high despite China, Korea, Brexit, Trump, Italy and Fed rate concerns, among others. US 10yr yield is at levels they were not supposed to reach until the end of 2017, reflation trade is in play and OPEC has finally agreed to production cuts.</em><em>Not many would have seen that coming. </em></p><p><em>For shipping it was another tough year. As 2016 (the most tumultuous and dreadful year for the global maritime industry in</em>…</p>

🎺🎺🎺 The Maritime Honours List 2016 🎺🎺🎺 As we near the end of the year, global markets are on a high despite China, Korea, Brexit, Trump, Italy and Fed rate concerns, among others. US 10yr yield is at levels they were not supposed to reach until the end of 2017, reflation trade is in play and OPEC has finally agreed to production cuts.Not many would have seen that coming. For shipping it was another tough year. As 2016 (the most tumultuous and dreadful year for the global maritime industry in…

<ul>
<li>Overweighting EM versus DM and global resources/deep cyclicals looked like a compelling contrarian bet coming into Q1 as consensus bearishness reached an extreme.</li>
<li><div>If the reflationary theme persists through 2017, EM equities will outperform bonds - the structural decline in ROE which led to very low P/B ratios now looks over.</div></li>
<li><div>The broad improvement in EM relative macro momentum is reflected in net earnings revision momentum (strongest in MSCI AXJ, with India the exception) and factory PMIs, if not…</div></li>
</ul>


Overweighting EM versus DM and global resources/deep cyclicals looked like a compelling contrarian bet coming into Q1 as consensus bearishness reached an extreme.
If the reflationary theme persists through 2017, EM equities will outperform bonds - the structural decline in ROE which led to very low P/B ratios now looks over.
The broad improvement in EM relative macro momentum is reflected in net earnings revision momentum (strongest in MSCI AXJ, with India the exception) and factory PMIs, if not…


2017 Asset Allocation Outlook: Part 1 – Emerging Markets and Commodities

Leading Independent Investment Research, Morningstar, Inc.

Morningstar

Leading Independent Investment Research

Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. We offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors. 

Morningstar provides data on more than 500,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 16 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries, with more than $180 billion in assets under advisement or management as of June 30, 2015. We have operations in 27 countries.

Download the Morningstar Fact Sheet : http://corporate.morningstar.com/US/documents/MarketingFactSheets/AboutMorningstarFactsheet.pdf

<p>OPEC's production cuts announced this week represent a positive near-term development for world oil markets, removing more than 1 million barrels per day from an oversupplied system. Even after factoring in the inevitable U.S. shale response to higher crude prices, OPEC's cuts point to a meaningful supply deficit next year. Consequently, we are raising our 2017 West Texas Intermediate price to $60 per barrel from $50.</p><p>Improved near-term fundamentals come at a cost, however. Even a modest recovery in oil prices will encourage U.S. shale producers to further ramp activity so that they eventually replace almost all "removed" OPEC barrels with their own. Increased near-term shale activity means that oil prices are unlikely to remain elevated for long. The industry is awash in low-cost oil, and temporary OPEC cuts cannot alter this reality. Our long-term oil price assumption of $55/bbl WTI is unchanged.</p><p><em>Analyst: Stephen Simko, CFA </em></p>

OPEC's production cuts announced this week represent a positive near-term development for world oil markets, removing more than 1 million barrels per day from an oversupplied system. Even after factoring in the inevitable U.S. shale response to higher crude prices, OPEC's cuts point to a meaningful supply deficit next year. Consequently, we are raising our 2017 West Texas Intermediate price to $60 per barrel from $50.Improved near-term fundamentals come at a cost, however. Even a modest recovery in oil prices will encourage U.S. shale producers to further ramp activity so that they eventually replace almost all "removed" OPEC barrels with their own. Increased near-term shale activity means that oil prices are unlikely to remain elevated for long. The industry is awash in low-cost oil, and temporary OPEC cuts cannot alter this reality. Our long-term oil price assumption of $55/bbl WTI is unchanged.Analyst: Stephen Simko, CFA 

OPEC Adds a Twist to the Plot, but the Ending Is Unchanged

United Kingdom

BP plc is an oil and petrochemicals company.  The Company explores for and produces oil and natural gas, refines, markets, and supplies petroleum products, generates solar energy, and manufactures and markets chemicals.  BP's chemicals include terephthalic acid, acetic acid, acrylonitrile, ethylene and polyethylene.

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BP PLC (BP/ LN)

Trump Not Likely to Halt Decline of US. But Ray Dalio Makes Good Case in Bringing Back Ayn Rand

I was working on a bigger piece on HK vs Singapore which I will put out later, and reviewing political classifications of economies, when I saw a...

Charles De Trenck

2017 Asset Allocation Outlook – Part 2: Trump Reflation Euphoria to Fade?

The overwhelming investor consensus a year ago was for further EM/commodity downside amid deflation fears - this year it is a USD secular bull and...

Sean Maher

🎺The Maritime Honours List 2016🎺

🎺🎺🎺 The Maritime Honours List 2016 🎺🎺🎺As we near the end of the year, global markets are on a high despite China, Korea, Brexit, Trump, Italy and...

Drewry Maritime Financial Research

2017 Asset Allocation Outlook: Part 1 – Emerging Markets and Commodities

Overweighting EM versus DM and global resources/deep cyclicals looked like a compelling contrarian bet coming into Q1 as consensus bearishness...

Sean Maher

OPEC Adds a Twist to the Plot, but the Ending Is Unchanged

OPEC's production cuts announced this week represent a positive near-term development for world oil markets, removing more than 1 million barrels...

Morningstar, Inc.

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