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>Many indexes (ACWI-US,ACWX-US,etc.) are near support, and we could see a bear market bounce, but until these indexes reverse their downtrends and break above resistance levels, we cannot be bullish.</li>
<li>On a positive note, we are starting to see signs that inflation is peaking, as commodity prices have pulled back substantially, and the Energy/Materials Sectors are under significant pressure.</li>
<li>If inflation and commodity prices have indeed peaked, global equities are likely in the early stages of a bottoming process.</li>
</ul>


Many indexes (ACWI-US,ACWX-US,etc.) are near support, and we could see a bear market bounce, but until these indexes reverse their downtrends and break above resistance levels, we cannot be bullish.
On a positive note, we are starting to see signs that inflation is peaking, as commodity prices have pulled back substantially, and the Energy/Materials Sectors are under significant pressure.
If inflation and commodity prices have indeed peaked, global equities are likely in the early stages of a bottoming process.


Inflation Peaking?; ACWI, ACWI Ex-US Near Support; Many Bottoms-Up Stock Recommendations

<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

Chief Economist & Political Strategist, CrossASEAN Research

Prasenjit K. Basu

Chief Economist & Political Strategist

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Cross Asset Strategy

<p>As we predicted in June 2020, US CPI inflation has jumped at the start of 2Q 2021, the headline rising to 4.2% YoY (a 12-year high) and the core-CPI inflation rate rising to 3% YoY (the highest in 25 years).  Although FOMC members insist inflation is "transitory", there are shortages of chips, ships, and many resources globally. Despite some seeming slack in the US labour market, it is proving difficult to move workers from sectors with surplus labour (eg, hospitality and aviation) to other sectors of the economy, and this friction is contributing to higher inflation. We believe the FOMC will have to cut back on the size of its asset purchases (thereby slowing M2 growth from its currently torrid 21% YoY pace), and will be obliged to raise the Fed Funds rate by 12.5bp by the July FOMC meeting.  </p><p>Inflation is also rising because the economy is operating near full-capacity after the massive fiscal stimulus (over 10% of GDP) passed by March 2021. President Biden has proposed US$4.1 trillion of additional spending on Infrastructure and Families over the next 8-10 years, to be financed by tax increases (a higher corporate tax rate of 28%, higher personal income tax rates for those with over US$1 million of annual income, and a near-doubling in the capital-gains tax rate for the richest). The tax increases are designed to pay for the increased spending over 15 years, implying that there will an additional fiscal stimulus since the spending will be more front-end-loaded than taxes. </p><p>This ambitious fiscal agenda, however, is only likely to be partially enacted, given that the Democrats have only 4 seats more than the half-way mark in the House, and exactly half the Senate (implying a big role for Vice President Harris's casting vote). Anything opposed by one of the 3 relatively conservative Democratic Senators (Manchin, Kelly and Sinema) or the Blue Dog coalition of centrist Democrats in the House (numbering 19 members). Truly ambitious spending aimed at creating permanent entitlements (e.g., the "green" and tech-intensive elements of Biden's Infrastructure Plan, and some elements of his Families plan that don't hit at "reparations") could pass with 60 Senate votes (at least 10 Republicans). But the size of the total spending will need to be cut back to about US$1 trillion (out of US$4.1 trillion) with commensurate compromises on taxes (corporate tax of 25%, capital gains tax rate hiked to less than a 30% peak with loopholes). Even using the Budgeting process to pass tax and spending through "reconciliation" (bypassing the need for 60 Senate votes, settling for 51) will have limited utility. While we expect a smaller package to get done, it will be less inflationary than the full Biden package. But inflation will nonetheless remain a factor all through 2021. We recommend being Underweight equities, with the allocation focused on mineral (including gold) companies, steel producers, plantation companies and industrial cyclicals that benefit from growth and inflation. </p>

As we predicted in June 2020, US CPI inflation has jumped at the start of 2Q 2021, the headline rising to 4.2% YoY (a 12-year high) and the core-CPI inflation rate rising to 3% YoY (the highest in 25 years).  Although FOMC members insist inflation is "transitory", there are shortages of chips, ships, and many resources globally. Despite some seeming slack in the US labour market, it is proving difficult to move workers from sectors with surplus labour (eg, hospitality and aviation) to other sectors of the economy, and this friction is contributing to higher inflation. We believe the FOMC will have to cut back on the size of its asset purchases (thereby slowing M2 growth from its currently torrid 21% YoY pace), and will be obliged to raise the Fed Funds rate by 12.5bp by the July FOMC meeting.  Inflation is also rising because the economy is operating near full-capacity after the massive fiscal stimulus (over 10% of GDP) passed by March 2021. President Biden has proposed US$4.1 trillion of additional spending on Infrastructure and Families over the next 8-10 years, to be financed by tax increases (a higher corporate tax rate of 28%, higher personal income tax rates for those with over US$1 million of annual income, and a near-doubling in the capital-gains tax rate for the richest). The tax increases are designed to pay for the increased spending over 15 years, implying that there will an additional fiscal stimulus since the spending will be more front-end-loaded than taxes. This ambitious fiscal agenda, however, is only likely to be partially enacted, given that the Democrats have only 4 seats more than the half-way mark in the House, and exactly half the Senate (implying a big role for Vice President Harris's casting vote). Anything opposed by one of the 3 relatively conservative Democratic Senators (Manchin, Kelly and Sinema) or the Blue Dog coalition of centrist Democrats in the House (numbering 19 members). Truly ambitious spending aimed at creating permanent entitlements (e.g., the "green" and tech-intensive elements of Biden's Infrastructure Plan, and some elements of his Families plan that don't hit at "reparations") could pass with 60 Senate votes (at least 10 Republicans). But the size of the total spending will need to be cut back to about US$1 trillion (out of US$4.1 trillion) with commensurate compromises on taxes (corporate tax of 25%, capital gains tax rate hiked to less than a 30% peak with loopholes). Even using the Budgeting process to pass tax and spending through "reconciliation" (bypassing the need for 60 Senate votes, settling for 51) will have limited utility. While we expect a smaller package to get done, it will be less inflationary than the full Biden package. But inflation will nonetheless remain a factor all through 2021. We recommend being Underweight equities, with the allocation focused on mineral (including gold) companies, steel producers, plantation companies and industrial cyclicals that benefit from growth and inflation. 

Biden's "Socialist" Remake of the US: How Much Will Be Too Much for the Blue Dogs?

Managing Director

Elan Gore

TMI Data Science

TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade & traditional media.  Our proprietary software, TMI Machine, is a text-mining platform designed with the buy-side & capital markets professional in mind, text-mining the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income & individual equities.  TMI provides custom leading indicators and systematic trading strategies, operating at the nexus of linguistics & statistics drawing on vast experience in investment banking and hedge fund settings in senior quantitative and fundamental roles.  

TMI Data Science was founded by Elan Gore, an award-winning Senior Global Basic Materials Equity Analyst & China Economist with 15 years of experience in North American hedge funds & institutional managers; and Alessandro Porrino, Ph.D., an Algorithmic Trading Analyst and Programmer with 10 years of front-office experience ranging from complex FX option pricing to auto-hedging strategies at Bank of America Merrill Lynch and Standard Chartered.  Mr. Gore holds an MBA in Finance from New York University Stern School of Business, and Mr. Porrino holds a Ph.D. in Systems Engineering from Brunel University London.

<ul>
<li>Earlier this month we saw coverage of infrastructure &amp; clean energy themes surging across the media in anticipation of President Biden unveiling a large follow-on infrastructure plan beyond the original $1.9tr relief package</li>
<li>As the energy crisis unfolded in Texas, the infrastructure theme received an additional boost last week with particular focus on the potential for large-scale copper-intensive power grid upgrades given the extent of damage and degree of unpreparedness</li>
<li>In Q4, the PBOC tightening theme trended sharply higher on a wave of bond defaults and lingering fears on the Three Red Lines policy; though anticipation of a shift in monetary policy continues given re-pricing of global bond yields, our data suggests the theme has stabilized relative to peak momentum seen in November-December</li>
<li>DXY appears to be on the verge of resuming a downtrend; aggregate futures positioning has been unchanged for weeks, and our text-mining sees a sharp drop in the "strong USD" side of the diffusion despite the yield spike</li>
</ul>


Earlier this month we saw coverage of infrastructure &amp; clean energy themes surging across the media in anticipation of President Biden unveiling a large follow-on infrastructure plan beyond the original $1.9tr relief package
As the energy crisis unfolded in Texas, the infrastructure theme received an additional boost last week with particular focus on the potential for large-scale copper-intensive power grid upgrades given the extent of damage and degree of unpreparedness
In Q4, the PBOC tightening theme trended sharply higher on a wave of bond defaults and lingering fears on the Three Red Lines policy; though anticipation of a shift in monetary policy continues given re-pricing of global bond yields, our data suggests the theme has stabilized relative to peak momentum seen in November-December
DXY appears to be on the verge of resuming a downtrend; aggregate futures positioning has been unchanged for weeks, and our text-mining sees a sharp drop in the "strong USD" side of the diffusion despite the yield spike


TMI Snapshot: Texas Boost to Copper & Infra Themes, PBOC Tightening Theme Stable, USD Downtrend

<ul>
<li>Despite ongoing headlines on slow vaccine rollouts and potential vaccine shortages in the first 3 weeks of January, overall sentiment on vaccine rollouts appears to be improving on the margin and negative coverage of the slow rollout has stabilized; this appears to be loosely correlated with price moves in WTI</li>
<li>Coverage of the vaccine hesitancy issue has been slowing since December; recent survey data suggests that while some geographic disparities remain, the hesitancy rate is dropping across the board</li>
<li>While seemingly spurious, the multi-STDEV January spike in coverage of the slow vaccine rollout appeared to coincide with the peak in EUR/USD; this is also reflected in action in our Eurozone macro sentiment indicator</li>
<li>Data remains volatile, but the past week's early signs of decline in negative vaccine rollout coverage is encouraging; further confirmation would go a long way in boosting some of the reflation trades paused in January (for example, Global Materials down -5% since January 7, same as the value-over-growth trade) with positive implications for the expected magnitude and timing of the mobility recovery</li>
</ul><div class="content-highlight"><p>TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary tool text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macro, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </p></div>


Despite ongoing headlines on slow vaccine rollouts and potential vaccine shortages in the first 3 weeks of January, overall sentiment on vaccine rollouts appears to be improving on the margin and negative coverage of the slow rollout has stabilized; this appears to be loosely correlated with price moves in WTI
Coverage of the vaccine hesitancy issue has been slowing since December; recent survey data suggests that while some geographic disparities remain, the hesitancy rate is dropping across the board
While seemingly spurious, the multi-STDEV January spike in coverage of the slow vaccine rollout appeared to coincide with the peak in EUR/USD; this is also reflected in action in our Eurozone macro sentiment indicator
Data remains volatile, but the past week's early signs of decline in negative vaccine rollout coverage is encouraging; further confirmation would go a long way in boosting some of the reflation trades paused in January (for example, Global Materials down -5% since January 7, same as the value-over-growth trade) with positive implications for the expected magnitude and timing of the mobility recovery
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary tool text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macro, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Snapshot:  Vaccine Sentiment Update - Early Signs of Improvement

United States

iShares Global Materials ETF is an exchange-traded fund incorporated in the USA. The Fund seeks results that correspond generally to the price and yield performance of the S&P Global Materials Index.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Ishares Global Materials ETF (MXI US)

Inflation Peaking?; ACWI, ACWI Ex-US Near Support; Many Bottoms-Up Stock Recommendations

We're starting to see signs that inflation is peaking, as commodity prices have pulled back substantially or are breaking, and the Energy $XLE and...

Vermilion Research

Sticking With Value; Buying Materials & Industrials

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

Biden's "Socialist" Remake of the US: How Much Will Be Too Much for the Blue Dogs?

Blue Dog moderate Democrats hold the voting key & will ensure a Biden-lite tax & spending agenda eventually gets through Congress. Inflation will...

Prasenjit K. Basu

TMI Snapshot: Texas Boost to Copper & Infra Themes, PBOC Tightening Theme Stable, USD Downtrend

Despite elevated momentum, the Texas energy crisis drove another boost to infrastructure themes with a focus on copper-intensive power grid...

Elan Gore

TMI Snapshot: Vaccine Sentiment Update - Early Signs of Improvement

After a surge in concerns related to the slow vaccine rollout in January, our text mining sees improvement on the margin in the past week, which...

Elan Gore

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)