Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>Tech selloff overnight on NVDA post-earnings weakness was fairly contained, and SPE related in Japan should continue yesterdays rebound off the morning lows.</li>
<li>Big beat for Dell on the strong outlook for its AI servers outweighing the soft consumer PC market sending it +8% in after-market trading.</li>
<li>News that Tepco plans to spend $3.2bn to upgrade its electricity infrastructure to 2030 positive for wire/cable names and related names.</li>
</ul>


Tech selloff overnight on NVDA post-earnings weakness was fairly contained, and SPE related in Japan should continue yesterdays rebound off the morning lows.
Big beat for Dell on the strong outlook for its AI servers outweighing the soft consumer PC market sending it +8% in after-market trading.
News that Tepco plans to spend $3.2bn to upgrade its electricity infrastructure to 2030 positive for wire/cable names and related names.


Japan Morning Connection: Tech Set to Rebound as Dell After-Market Print Sets Positive Tone

<ul>
<li>Watch for a 'megaquake' reversal after a big rotation for names deemed to be winners/losers on Friday on heightened expectations for a major Nankai Trough earthquake over the w/e</li>
<li>Retail related should rebound sharply after a solid 1Q showing from 3099 <a href="https://www.smartkarma.com/entities/isetan-mitsukoshi-holdings-ltd" target="_blank" data-smartkarma-citation="entities:18871:1" rel="noopener">Isetan Mitsukoshi</a>, with several related names yet to rebound on concerns the stronger yen will curb tourist spending.</li>
<li>1911 <a href="https://www.smartkarma.com/entities/sumitomo-forestry-co-ltd" target="_blank" data-smartkarma-citation="entities:9769:1" rel="noopener">Sumitomo Forestry</a> business briefing Friday confirms the strength of its US housing business, with it likely to easily exceed its latest MTP.</li>
</ul>


Watch for a 'megaquake' reversal after a big rotation for names deemed to be winners/losers on Friday on heightened expectations for a major Nankai Trough earthquake over the w/e
Retail related should rebound sharply after a solid 1Q showing from 3099 Isetan Mitsukoshi, with several related names yet to rebound on concerns the stronger yen will curb tourist spending.
1911 Sumitomo Forestry business briefing Friday confirms the strength of its US housing business, with it likely to easily exceed its latest MTP.


Japan Morning Connection: 3099 JP, 1911 JP, 5803 JP

<ul>
<li>ARM +11% after a broker upgrade yesterday will see <a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a> rebound sharply off heavily sold levels yesterday, despite its surprise Y500bn buyback.</li>
<li>Tech wide relief rally in the US sets the tone for a very strong day in Japan, helped by strong earnings by the likes of <a href="https://www.smartkarma.com/entities/tokyo-electron-ltd" target="_blank" data-smartkarma-citation="entities:280:1" rel="noopener">TEL (8035)</a> and <a href="https://www.smartkarma.com/entities/kokusai-electric-corp" target="_blank" data-smartkarma-citation="entities:40152:1" rel="noopener">Kokusai (6525).</a>
</li>
<li>Jobs data saw leisure and powersports names in the US rally which should help the likes of <a href="https://www.smartkarma.com/entities/yamaha-motor-co-ltd" target="_blank" data-smartkarma-citation="entities:7411:1" rel="noopener">Yamaha Motor (7272 JP)</a> and <a href="https://www.smartkarma.com/entities/kawasaki-heavy-industries" target="_blank" data-smartkarma-citation="entities:8790:1" rel="noopener">KHI (7012 JP)</a> rebound sharply also.</li>
</ul>


ARM +11% after a broker upgrade yesterday will see Softbank Group (9984 JP) rebound sharply off heavily sold levels yesterday, despite its surprise Y500bn buyback.
Tech wide relief rally in the US sets the tone for a very strong day in Japan, helped by strong earnings by the likes of TEL (8035) and Kokusai (6525).

Jobs data saw leisure and powersports names in the US rally which should help the likes of Yamaha Motor (7272 JP) and KHI (7012 JP) rebound sharply also.


Japan Morning Connection: 9984 JP, 8035 JP, 6525 JP

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

<ul>
<li>There are 44 adds/41 deletes for the JPX Nikkei 400 Index to bring the number of index constituents back to 400. There are stocks with multiple days ADV to trade.</li>
<li>Based on the adds, deletes and capping changes, we estimate one way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn).</li>
<li>The adds have outperformed the deletes over the last year though that has been faded over the last couple of months. Breaking with history, there could be outperformance near-term.</li>
</ul>


There are 44 adds/41 deletes for the JPX Nikkei 400 Index to bring the number of index constituents back to 400. There are stocks with multiple days ADV to trade.
Based on the adds, deletes and capping changes, we estimate one way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn).
The adds have outperformed the deletes over the last year though that has been faded over the last couple of months. Breaking with history, there could be outperformance near-term.


JPX Nikkei 400 Index Rebalance: A Bunch of Chunky Adds & US$6bn Trade

Japan Specialist

Mark Chadwick

<ul>
<li>The Nikkei and Topix indexes advanced 1.36% and 2.11%, respectively, for the week.</li>
<li>Fujikura (5803): +18% - The Nikkei's reported $2.9bn Microsoft data center investment in Japan fuels optimism for fiber optic cable companies like Fujikura</li>
<li>Japan Steel Works (5631): +14% - JSW's shares continue their upward trend, fueled by optimism surrounding nuclear power and defense spending</li>
</ul>


The Nikkei and Topix indexes advanced 1.36% and 2.11%, respectively, for the week.
Fujikura (5803): +18% - The Nikkei's reported $2.9bn Microsoft data center investment in Japan fuels optimism for fiber optic cable companies like Fujikura
Japan Steel Works (5631): +14% - JSW's shares continue their upward trend, fueled by optimism surrounding nuclear power and defense spending


Japan Weekly | Fujikura, Monotaro, Japan Steel Works

Japan

Fujikura Ltd. manufactures and sells wires and cables such as optical fiber cables and coaxial cables. The Company's products include optical transmission system, electronic materials, and telecommunication cables.

Price Gauge
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Fujikura Ltd (5803 JP)

Japan Morning Connection: Tech Set to Rebound as Dell After-Market Print Sets Positive Tone

Tech selloff contained, Dell beats with strong outlook for AI servers, Tepco's $3.2bn upgrade plan positive for wire/cable names.

Andrew Jackson

Japan Morning Connection: 3099 JP, 1911 JP, 5803 JP

Expect a 'megaquake' reversal in stock names post-rotation due to earthquake warnings, retail rebound likely after strong 3099 1Q showing,...

Andrew Jackson

Japan Morning Connection: 9984 JP, 8035 JP, 6525 JP

ARM stock surges after broker upgrade, Softbank Group rebounds, tech rally in US boosts Japan market, leisure and powersports names rally in US...

Andrew Jackson

JPX Nikkei 400 Index Rebalance: A Bunch of Chunky Adds & US$6bn Trade

There are 44 adds/41 deletes for the JPX Nikkei 400 Index resulting in a one-way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn)....

Brian Freitas

Japan Weekly | Fujikura, Monotaro, Japan Steel Works

Japanese stock indexes rose last week, with Fujikura and Japan Steel Works seeing significant gains on positive news in tech and defense sectors.

Mark Chadwick

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Japan Morning Connection: Tech Set to Rebound as Dell After-Market Print Sets Positive Tone

​Tech selloff contained, Dell beats with strong outlook for AI servers, Tepco's $3.2bn upgrade plan positive for wire/cable names.

Andrew Jackson

Japan Morning Connection: 3099 JP, 1911 JP, 5803 JP

​Expect a 'megaquake' reversal in stock names post-rotation due to earthquake warnings, retail rebound likely after strong 3099 1Q showing,...

Andrew Jackson

Japan Morning Connection: 9984 JP, 8035 JP, 6525 JP

​ARM stock surges after broker upgrade, Softbank Group rebounds, tech rally in US boosts Japan market, leisure and powersports names rally in US...

Andrew Jackson

JPX Nikkei 400 Index Rebalance: A Bunch of Chunky Adds & US$6bn Trade

There are 44 adds/41 deletes for the JPX Nikkei 400 Index resulting in a one-way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn)....

Brian Freitas

Japan Weekly | Fujikura, Monotaro, Japan Steel Works

​Japanese stock indexes rose last week, with Fujikura and Japan Steel Works seeing significant gains on positive news in tech and defense sectors.

Mark Chadwick

Tech selloff contained, Dell beats with strong outlook for AI servers, Tepco's $3.2bn upgrade plan positive for wire/cable names.

Expect a 'megaquake' reversal in stock names post-rotation due to earthquake warnings, retail rebound likely after strong 3099 1Q showing,...

ARM stock surges after broker upgrade, Softbank Group rebounds, tech rally in US boosts Japan market, leisure and powersports names rally in US...

Japanese stock indexes rose last week, with Fujikura and Japan Steel Works seeing significant gains on positive news in tech and defense sectors.