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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

<ul>
<li>The review period for the March review of the HSCI ended on 31 December. There are a lot of new listings that should be included in the index.</li>
<li>SenseTime is a high probability inclusion to the index, though it will only be added to Stock Connect in July once it completes 6 months and 20 trading days.</li>
<li>Xpeng and Li Auto will be added to Stock Connect in Feb/March if they pass the velocity test. We see Li Auto as failing the test, while Xpeng is close.</li>
</ul>


The review period for the March review of the HSCI ended on 31 December. There are a lot of new listings that should be included in the index.
SenseTime is a high probability inclusion to the index, though it will only be added to Stock Connect in July once it completes 6 months and 20 trading days.
Xpeng and Li Auto will be added to Stock Connect in Feb/March if they pass the velocity test. We see Li Auto as failing the test, while Xpeng is close.


HSCI Index Rebalance and Stock Connect: Plenty of New Listings Should Be Included

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

<ul>
<li>Market dynamics remain largely constructive and we are now seeing meaningful improvement within emerging markets (EEM-US) as the Hang Seng index displays bullish price and relative strength (RS) reversals.</li>
<li>Brent and WTI crude oil are hitting 8-year highs, base metals are bullishly inflecting, and critical supports are holding on the broad global indexes.</li>
<li>Sticking with the theme from last week when we recommended Energy and Financials, two more Sectors that stand to benefit from rising rates include Materials and Industrials/Manufacturing -- add exposure.</li>
</ul>


Market dynamics remain largely constructive and we are now seeing meaningful improvement within emerging markets (EEM-US) as the Hang Seng index displays bullish price and relative strength (RS) reversals.
Brent and WTI crude oil are hitting 8-year highs, base metals are bullishly inflecting, and critical supports are holding on the broad global indexes.
Sticking with the theme from last week when we recommended Energy and Financials, two more Sectors that stand to benefit from rising rates include Materials and Industrials/Manufacturing -- add exposure.


Sticking With Value; Buying Materials & Industrials

Chart based progressive global trading strategies, Chart Partners

Thomas Schroeder

Chart based progressive global trading strategies

Chart Partners

Chart Partners objective is to discover medium-term cycle turns and profit opportunities before they unfold, within structural trends while preserving capital with clear degrees of risk. We have real return ideas. 

Markets are dynamic and trading systems must reflect this. It is crucial to determine underlying correlations and lead-lag relationships within global markets and the impact on linked instruments. Our weekly Chartonics product gives you short-term trading strategies that can be applied within the medium and longer term macro trends that are mapped out in our strategy updates. 

Our methodology fuses global market variables and isolates drivers in trends. We specialize in FX, index trade in NY and Asia with a focus on Asian stocks. 

Taiwan Stock Exchange Weighted Index / Technical Analysis

<ul>
<li>Australia and Taiwan have been top long picks with Korea the underdog to eventually clear the 400 barrier. H shares on the back burner. KLSE meeting our rally turn target.</li>
<li>Asia top short picks are are HSI and Japan's Nikkei. Nifty re short zone near key resistance after meeting our 16,500 bounce target. STI a short into near term strength.</li>
<li>January allows for a pullback sequence that sets up fresh buy levels in Asia for a push into February/March.</li>
</ul>


Australia and Taiwan have been top long picks with Korea the underdog to eventually clear the 400 barrier. H shares on the back burner. KLSE meeting our rally turn target.
Asia top short picks are are HSI and Japan's Nikkei. Nifty re short zone near key resistance after meeting our 16,500 bounce target. STI a short into near term strength.
January allows for a pullback sequence that sets up fresh buy levels in Asia for a push into February/March.


<ul>
<li>Tactical sell this bounce in the US for a test on core trendline and price supports in late December that sets up a fresh rally sequence. Asia trading heavier.</li>
<li>Asian short focus remains in HSI/China, Nikkei, Nifty (decline maturing) and Singapore. Late December weakness will participants counting on a rise into year-end.</li>
<li>Asia long focus in ASX, Taiwan and Korea timed to a late December washout.</li>
</ul>


Tactical sell this bounce in the US for a test on core trendline and price supports in late December that sets up a fresh rally sequence. Asia trading heavier.
Asian short focus remains in HSI/China, Nikkei, Nifty (decline maturing) and Singapore. Late December weakness will participants counting on a rise into year-end.
Asia long focus in ASX, Taiwan and Korea timed to a late December washout.


Orient Overseas International / Event-Driven

<ul>
<li>The review period for the March review of the HSCI ends on 31 December. There are expected to be a lot more inclusions than deletions at the review.</li>
<li>There are quite a few stocks that should be included following their listing over the last couple of months while others are now potential inclusions after passing the velocity test.</li>
<li>Quite a few of the potential deletions from the HSCI and Stock Connect have large holdings via Southbound Stock Connect and these stock could see some selling.</li>
</ul>


The review period for the March review of the HSCI ends on 31 December. There are expected to be a lot more inclusions than deletions at the review.
There are quite a few stocks that should be included following their listing over the last couple of months while others are now potential inclusions after passing the velocity test.
Quite a few of the potential deletions from the HSCI and Stock Connect have large holdings via Southbound Stock Connect and these stock could see some selling.


HSCI Index Rebalance and Stock Connect: More Inclusions than Exclusions in March

Hong Kong

The Hang Seng Index is a free-float capitalization-weighted index of a selection of companies from the Stock Exchange of Hong Kong. The components of the index are divided into four subindices: Commerce and Industry, Finance, Utilities, and Properties. The index was developed with a base level of 100 as of July 31, 1964.

Hang Seng Index (HSI INDEX)

HSCI Index Rebalance and Stock Connect: Plenty of New Listings Should Be Included

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Sticking with the theme from last week when we recommended Energy and Financials, two more Sectors that stand to benefit from rising rates include...

Vermilion Research

Asia Long and Short Bets

Australia and Taiwan have been top long picks with Korea the underdog to eventually clear the 400 barrier. H shares on the back burner. KLSE...

Thomas Schroeder

Fresh Sell Levels in Asia

Tactical sell this bounce in the US for a test on core trendline and price supports in late December that sets up a fresh rally sequence. Asia...

Thomas Schroeder

HSCI Index Rebalance and Stock Connect: More Inclusions than Exclusions in March

We expect there will be a lot more inclusions than exclusions at the March rebalance of the HSCI. The changes to the index will result in changes...

Brian Freitas