'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

ja research

ja research is an independent research platform focused exclusively on Japanese equities. Leveraging data and graphic analysis provided by Japan Analytics, we provide insights on small and medium-sized companies that have been ignored by the sell-side as well as challenging conventional wisdom on larger companies. We also offer analyst and corporate access, the latter with translation if required. 

Quantitative Analysis

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/094/809/original/2019-08-04_13-24-01.png?1564892655" class="editor-image img-responsive" data-smartkarma-image-id="94809"></figure><div class="content-caption">Source: Japan Analytics</div>SOUTHBOUND - Two weeks into the announcements of the June quarter-end period, it is clear that the momentum of Japanese listed corporate earnings is still heading lower. Since July 22nd, 1,216 or 32% of companies have reported results and 292 forecast revisions have been announced. The Japan Analytics Results &amp; Revision Score reached a new 28-month low on Friday of 1.43, a decline of 78% from the current cycle peak of 6.50 on 16th November 2017. The correlation between the Score and the Market Capitalisation of listed companies excluding REITs is 0.77, and the Score is more of a leading or co-incident than lagging indicator.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/094/810/original/2019-08-04_13-32-15.png?1564893149" class="editor-image img-responsive" data-smartkarma-image-id="94810"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/094/812/original/2019-08-04_13-39-03.png?1564893556" class="editor-image img-responsive" data-smartkarma-image-id="94812"></figure><div class="content-caption">Source: Japan Analytics</div>BREAKDOWN - The Results &amp; Revision Score is a weighted sum of three components, the Results Score, the Annual Forecast/Revision Score and the Interim Forecast/Revision Score, with the last of these only being applicable for nine months of each year. The two Forecast/Revision Scores are, as would be expected., leading indicators for the Results Score. The current quarter's Results Scor decline already exceeds the previous quarter's more-benign decline which also saw an increase in the Annual Forecast/Revision Score as the majority of companies 'rolled' their forecast ahead by one year. In contrast, the forecasts for the Interim period which for most companies ends next month were the most pessimistic since April 2016 and the mostly first-quarter results are confirming the early caution. In addition, full-year forecasts are also being downgraded and are at the lowest level for three months.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/094/816/original/2019-08-04_13-44-46.png?1564893904" class="editor-image img-responsive" data-smartkarma-image-id="94816"></figure><div class="content-caption">Source: Japan Analytics</div>YEN DRIVER - The key driver of the Results &amp; Revision Score has been the year-on-year change in the US dollar/Yen exchange rate lagged by six months. The major turning points in <a href="https://www.smartkarma.com/entities/22826" target="_blank" data-smartkarma-citation="entities:22826:1" rel="noopener">JUSDJPY CURNCY</a> over the last twelve years highlighted above line up well with changes in the direction of earnings momentum as represented by the Results &amp; Revision Score. With the Yen having reverted to a period of strengthening in recent weeks, the trend in the Score will be downwards over the next six months, which will be reflected in due course by the market.    <div class="content-highlight">In the DETAIL section below, we update our Market Composite Results Timeline, Sector and Peer Group Results &amp; Revision Scores, Sector Performance and Valuation and look at the best and worst large-cap individual company results over the last two weeks. In the meantime, we lighten the mood with a classic Allman Brother track featuring the incomparable Dicky Betts.</div><center></center><div class="content-caption">The Allman Brothers Band - Southbound - 1/16/1982 - University Of Florida Bandshell</div>

Source: Japan AnalyticsSOUTHBOUND - Two weeks into the announcements of the June quarter-end period, it is clear that the momentum of Japanese listed corporate earnings is still heading lower. Since July 22nd, 1,216 or 32% of companies have reported results and 292 forecast revisions have been announced. The Japan Analytics Results &amp; Revision Score reached a new 28-month low on Friday of 1.43, a decline of 78% from the current cycle peak of 6.50 on 16th November 2017. The correlation between the Score and the Market Capitalisation of listed companies excluding REITs is 0.77, and the Score is more of a leading or co-incident than lagging indicator.Source: Japan AnalyticsBREAKDOWN - The Results &amp; Revision Score is a weighted sum of three components, the Results Score, the Annual Forecast/Revision Score and the Interim Forecast/Revision Score, with the last of these only being applicable for nine months of each year. The two Forecast/Revision Scores are, as would be expected., leading indicators for the Results Score. The current quarter's Results Scor decline already exceeds the previous quarter's more-benign decline which also saw an increase in the Annual Forecast/Revision Score as the majority of companies 'rolled' their forecast ahead by one year. In contrast, the forecasts for the Interim period which for most companies ends next month were the most pessimistic since April 2016 and the mostly first-quarter results are confirming the early caution. In addition, full-year forecasts are also being downgraded and are at the lowest level for three months.Source: Japan AnalyticsYEN DRIVER - The key driver of the Results &amp; Revision Score has been the year-on-year change in the US dollar/Yen exchange rate lagged by six months. The major turning points in JUSDJPY CURNCY over the last twelve years highlighted above line up well with changes in the direction of earnings momentum as represented by the Results &amp; Revision Score. With the Yen having reverted to a period of strengthening in recent weeks, the trend in the Score will be downwards over the next six months, which will be reflected in due course by the market.    In the DETAIL section below, we update our Market Composite Results Timeline, Sector and Peer Group Results &amp; Revision Scores, Sector Performance and Valuation and look at the best and worst large-cap individual company results over the last two weeks. In the meantime, we lighten the mood with a classic Allman Brother track featuring the incomparable Dicky Betts.The Allman Brothers Band - Southbound - 1/16/1982 - University Of Florida Bandshell

🇯🇵 Japan • Summer Results & Revisions First Cut - Southbound

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. 

Technical Analysis

Our base case called for a Fed induced rise to SPX 3,023 with risk to 3,050 to trim longs and put on short (sell the fact) exposure as a hedge for a second press on 2,970/50 pivot support. Below 2,950 would be a bigger negative signal as we move into the seasonally weak August to October period. More importantly core sectors remain weak and teetering on a fresh underperform cycles in the DJI, transports, small caps and banks. Proofing the weaker sectors was a vital ingredient in identifying increased odds of the current rise being unsustainable.SPX 3,023 is now a firmer resistance with 2,950 as the bull/bear line in the sand. This webcast outlines action levels in the SPX, Russell short entry and the probe to short the NDX. USD remains well bid as the Euro cracks the 1.11 key support. Europe is the space to lean on shorts ahead of an SPX break below 2,950.Asia - Already short via HK, STI, Korea, Taiwan and India. ASX the long O/P and defensives. A50 sell strength was our mantra. India's Nifty is close to bounce support but remains a macro sell on rallies. Nikkei bias improves marginally with the USD/JPY above 109 (to 110.50 fresh turn resistance).

Our base case called for a Fed induced rise to SPX 3,023 with risk to 3,050 to trim longs and put on short (sell the fact) exposure as a hedge for a second press on 2,970/50 pivot support. Below 2,950 would be a bigger negative signal as we move into the seasonally weak August to October period. More importantly core sectors remain weak and teetering on a fresh underperform cycles in the DJI, transports, small caps and banks. Proofing the weaker sectors was a vital ingredient in identifying increased odds of the current rise being unsustainable.SPX 3,023 is now a firmer resistance with 2,950 as the bull/bear line in the sand. This webcast outlines action levels in the SPX, Russell short entry and the probe to short the NDX. USD remains well bid as the Euro cracks the 1.11 key support. Europe is the space to lean on shorts ahead of an SPX break below 2,950.Asia - Already short via HK, STI, Korea, Taiwan and India. ASX the long O/P and defensives. A50 sell strength was our mantra. India's Nifty is close to bounce support but remains a macro sell on rallies. Nikkei bias improves marginally with the USD/JPY above 109 (to 110.50 fresh turn resistance).

DXY weekly cycle is breaking down on the back of non confirmation in trending indicators and the break of rising wedge support (falling wedge resistance the case of the Euro). Fresh Euro buy support lies near or just under 1.13.This webcast outlines what currencies in Asia we are trading a USD bounce and where to set intermediate short levels with a focus in the USD/SGD and USD/KRW near respective resistance points at 1.36 and 1,170.USD/THB is moving into a more strategic low and leading the USD bottom cycle in Asia with a focus on the 30.50 level. We closed our short from 32.00.EM FX short term lows are visible in a number of 5 wave counts that call for a dollar bounce and one that sets up a short in line with our DXY shift. We like the CAD on a USD bounce as the top commodity currency.Strategy points – Euro above 1.13 is bearish DXY (below 96.50). Weekly DXY cycle rolling over and calls for selling USD rallies. Sterling may have difficulty at 1.28. USD/JPY 109/108 pivotal for global risk (keep in mind the USD/JPY bearish formation is of a macro degree). US 10yr yield looks very oversold into weakness below 2% and may be a variable that helps the USD bounce near term. Our bet is for a bounce to 2.18% with scope to 2.30% (remain macro bearish yield to 1.62%).

DXY weekly cycle is breaking down on the back of non confirmation in trending indicators and the break of rising wedge support (falling wedge resistance the case of the Euro). Fresh Euro buy support lies near or just under 1.13.This webcast outlines what currencies in Asia we are trading a USD bounce and where to set intermediate short levels with a focus in the USD/SGD and USD/KRW near respective resistance points at 1.36 and 1,170.USD/THB is moving into a more strategic low and leading the USD bottom cycle in Asia with a focus on the 30.50 level. We closed our short from 32.00.EM FX short term lows are visible in a number of 5 wave counts that call for a dollar bounce and one that sets up a short in line with our DXY shift. We like the CAD on a USD bounce as the top commodity currency.Strategy points – Euro above 1.13 is bearish DXY (below 96.50). Weekly DXY cycle rolling over and calls for selling USD rallies. Sterling may have difficulty at 1.28. USD/JPY 109/108 pivotal for global risk (keep in mind the USD/JPY bearish formation is of a macro degree). US 10yr yield looks very oversold into weakness below 2% and may be a variable that helps the USD bounce near term. Our bet is for a bounce to 2.18% with scope to 2.30% (remain macro bearish yield to 1.62%).

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Thematic (Sector/Industry)

<ul>
<li>KOSPI is up 1.3% YTD. KRW has depreciated 5.6% versus USD YTD.</li>
<li>Nikkei is up 2.0% YTD. Yen has appreciated 1.3% versus USD YTD. </li>
</ul>In the past week, the following reports that are relevant for Japan and Korea have received a lot of interest among Smartkarma readers:<ul>
<li><a href="https://www.smartkarma.com/insights/big-tokyo-electron-buyback" target="_blank" data-smartkarma-citation="insights:30076">Big Tokyo Electron Buyback</a></li>
<li><a href="https://www.smartkarma.com/insights/nexon-sale-main-bidding-round-summary" target="_blank" data-smartkarma-citation="insights:30176">Nexon Sale: Main Bidding Round Summary</a></li>
<li><a href="https://www.smartkarma.com/insights/fiat-chrysler-proposes-merger-with-renault-lotsa-moving-parts-but-rno-too-cheap" target="_blank" data-smartkarma-citation="insights:30068">Fiat-Chrysler Proposes Merger with Renault - Lotsa Moving Parts But RNO Too Cheap</a></li>
<li><a href="https://www.smartkarma.com/insights/softbank-group-this-is-the-right-time-to-launch-a-second-vision-fund" target="_blank" data-smartkarma-citation="insights:30089">Softbank Group: This Is the Right Time to Launch a Second Vision Fund</a></li>
<li><a href="https://www.smartkarma.com/insights/nexon-sale-bidding-progress-update" target="_blank" data-smartkarma-citation="insights:30080">Nexon Sale: Bidding Progress Update</a></li>
</ul>


KOSPI is up 1.3% YTD. KRW has depreciated 5.6% versus USD YTD.
Nikkei is up 2.0% YTD. Yen has appreciated 1.3% versus USD YTD. 
In the past week, the following reports that are relevant for Japan and Korea have received a lot of interest among Smartkarma readers:
Big Tokyo Electron Buyback
Nexon Sale: Main Bidding Round Summary
Fiat-Chrysler Proposes Merger with Renault - Lotsa Moving Parts But RNO Too Cheap
Softbank Group: This Is the Right Time to Launch a Second Vision Fund
Nexon Sale: Bidding Progress Update


Smartkarma’s Week That Was in JP/​​​​​​​​​KR: Tokyo Electron, Suruga Bank, & Depreciating KRW

In April we pinpointed weakening US equity breadth as a dire warning of a peak in US equities (started shorting weaker underperform sectors) as well as our SOX-NDX-SPX domino cascade call that would lead to a downturn. This topping sequence was outlined on April 29 <a href="https://www.smartkarma.com/insights/sox-cracks-that-would-impact-the-global-tech-cycle" target="_blank" data-smartkarma-citation="insights:29471">SOX Cracks that Would Impact the Global Tech Cycle</a> and again on May 23 <a href="https://www.smartkarma.com/insights/sox-bleed-into-ndx-spx-and-global-tech-playing-out" target="_blank" data-smartkarma-citation="insights:29999">SOX Bleed into NDX, SPX and Global Tech Playing Out</a> .We now see more ominous signals unfolding that could induce a near term flash crash.Plunging bond yields, weak oil, weakening US equity breadth, USD/JPY triangle breakdown risk, gold perking up and subdued volatility are all variables culminating into a perfect storm as Trump wields his tariff saber.Charts pinpoint downside inflection triggers that would see a continueation of our bleed from tech into the SPX and the global risk cycle.

In April we pinpointed weakening US equity breadth as a dire warning of a peak in US equities (started shorting weaker underperform sectors) as well as our SOX-NDX-SPX domino cascade call that would lead to a downturn. This topping sequence was outlined on April 29 SOX Cracks that Would Impact the Global Tech Cycle and again on May 23 SOX Bleed into NDX, SPX and Global Tech Playing Out .We now see more ominous signals unfolding that could induce a near term flash crash.Plunging bond yields, weak oil, weakening US equity breadth, USD/JPY triangle breakdown risk, gold perking up and subdued volatility are all variables culminating into a perfect storm as Trump wields his tariff saber.Charts pinpoint downside inflection triggers that would see a continueation of our bleed from tech into the SPX and the global risk cycle.

Japan

The Japanese yen is the official currency of Japan. 

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

JPY (USDJPY CURNCY)

🇯🇵 Japan • Summer Results & Revisions First Cut - Southbound

SOUTHBOUND - Two weeks into the announcements of the June quarter-end period, it is clear that the momentum of Japanese listed corporate earnings...

Campbell Gunn

Post Fed Fade from SPX 3,023 Turn Level

Our base case called for a Fed induced rise to SPX 3,023 with risk to 3,050 to trim longs and put on short (sell the fact) exposure as a hedge for...

Thomas Schroeder

Where to Sell the USD Post Bounce

DXY weekly cycle is breaking down on the back of non confirmation in trending indicators and the break of rising wedge support (falling wedge...

Thomas Schroeder

Smartkarma’s Week That Was in JP/KR: Tokyo Electron, Suruga Bank, & Depreciating KRW

KOSPI is up 1.3% YTD. KRW has depreciated 5.6% versus USD YTD. Nikkei is up 2.0% YTD. Yen has appreciated 1.3% versus USD YTD. In the past week,...

Douglas Kim

Equity Flash Crash Markers

In April we pinpointed weakening US equity breadth as a dire warning of a peak in US equities (started shorting weaker underperform sectors) as...

Thomas Schroeder

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

🇯🇵 Japan • Summer Results & Revisions First Cut - Southbound

SOUTHBOUND - Two weeks into the announcements of the June quarter-end period, it is clear that the momentum of Japanese listed corporate earnings...

Campbell Gunn

Post Fed Fade from SPX 3,023 Turn Level

Our base case called for a Fed induced rise to SPX 3,023 with risk to 3,050 to trim longs and put on short (sell the fact) exposure as a hedge for...

Thomas Schroeder

Where to Sell the USD Post Bounce

DXY weekly cycle is breaking down on the back of non confirmation in trending indicators and the break of rising wedge support (falling wedge...

Thomas Schroeder

Smartkarma’s Week That Was in JP/​​​​​​​​​KR: Tokyo Electron, Suruga Bank, & Depreciating KRW

KOSPI is up 1.3% YTD. KRW has depreciated 5.6% versus USD YTD. Nikkei is up 2.0% YTD. Yen has appreciated 1.3% versus USD YTD. In the past week,...

Douglas Kim

Equity Flash Crash Markers

In April we pinpointed weakening US equity breadth as a dire warning of a peak in US equities (started shorting weaker underperform sectors) as...

Thomas Schroeder

Smartkarma’s Week That Was in JP/KR: Tokyo Electron, Suruga Bank, & Depreciating KRW