Covering the Mexican Economy, Actinver Research

Actinver

Covering the Mexican Economy

Actinver Research

Actinver is a mexican leading financial group, that generates well being for individuals and companies through advisory services that provides investment management to maintain and grow their wealth.

Macroeconomics

<ul>
<li>Banco de México (Banxico) presented its Quarterly Report yesterday, in which it reinforces the idea that the rate cut on August 8th was justified by the current economic slowdown and the expectation that the price increases experienced by agricultural products during June and July will be reversed.</li>
<li>In this context, the Central Bank lowered its growth forecast from 2.4% to 1.5% for this year and from 1.5% to 1.2% for 2025.</li>
<li>This, along with the expected decrease in headline inflation to 4.4% during the fourth quarter of the year and the statements from the Board of Governors on the need to adjust the restrictive stance, supports our belief that Banxico plans to cut its reference rate in November and December.</li>
</ul>


Banco de México (Banxico) presented its Quarterly Report yesterday, in which it reinforces the idea that the rate cut on August 8th was justified by the current economic slowdown and the expectation that the price increases experienced by agricultural products during June and July will be reversed.
In this context, the Central Bank lowered its growth forecast from 2.4% to 1.5% for this year and from 1.5% to 1.2% for 2025.
This, along with the expected decrease in headline inflation to 4.4% during the fourth quarter of the year and the statements from the Board of Governors on the need to adjust the restrictive stance, supports our belief that Banxico plans to cut its reference rate in November and December.


Actinver Research - Macro Daily: Banxico Quarterly Report

Head of Research and Global Chief Strategist, Steno Research

Andreas Steno

Head of Research and Global Chief Strategist

Macro and Geopolitical Research House

Steno Research

Steno Research is a new macro and geopolitical research house. We are based out of Copenhagen, Denmark, but have an international team and a strong network of sources and partners around the world. The team is lead by Andreas Steno, previous global head of strategy at Nordea Bank, and Mikkel Rosenvold, former chief consultant in the Danish Ministry of Finance.

Cross Asset Strategy

<ul><li>The cyclical rotation is slowly but slowly rolling and if central banks add rate cuts to this mix, we are staring directly into the melt up.</li><li>Welcome to our weekly Portfolio Watch, where we assess the tradeable themes and discuss our portfolio composition.</li><li>In this revamped version of the series, we will touch upon the developments in our Macro Alpha Portfolio and our Digital Assets Portfolio.</li></ul>

The cyclical rotation is slowly but slowly rolling and if central banks add rate cuts to this mix, we are staring directly into the melt up.Welcome to our weekly Portfolio Watch, where we assess the tradeable themes and discuss our portfolio composition.In this revamped version of the series, we will touch upon the developments in our Macro Alpha Portfolio and our Digital Assets Portfolio.

Portfolio Watch: What if We Add a Rate Cut to This Fire..

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>We see global equities (MSCI ACWI) going through a pause/pullback amid short-term breakouts in the U.S. dollar (DXY) and global sovereign 10-year yields.</li>
<li>A rising DXY and climbing yields is a near-term headwind, and we could continue to see more choppy price action in the weeks ahead.</li>
<li>With that said, as long as the DXY remains below $106, the 10-year Treasury yield remains below 4.35%, and ACWI-US is <em>above</em> $98, we would view pullbacks as buying opportunities.</li>
</ul>


We see global equities (MSCI ACWI) going through a pause/pullback amid short-term breakouts in the U.S. dollar (DXY) and global sovereign 10-year yields.
A rising DXY and climbing yields is a near-term headwind, and we could continue to see more choppy price action in the weeks ahead.
With that said, as long as the DXY remains below $106, the 10-year Treasury yield remains below 4.35%, and ACWI-US is above $98, we would view pullbacks as buying opportunities.


Pause/Pullback Underway; Downgrading Europe and Mexico; Buys in Services, Tech, Comm, Healthcare

MSCI Emerging Markets Index / Technical Analysis

<ul>
<li>In our February 6, 2023 EM Strategy, we discussed that we were buyers of the MSCI EM (EEM-US) on a pullback to the 50-day MA. </li>
<li>The pullback went a bit deeper but managed to hold at our $37.50 line-in-the-sand which we discussed in our recent ETF Pathfinder reports (Mar. 6 and Mar. 20, 2023).</li>
<li>The EEM-US displays a bullish 2-month downtrend reversal- add exposure. Signs continue to point to a topping DXY, and a declining DXY has historically resulted in EM outperformance (vs. EAFE).</li>
</ul>


In our February 6, 2023 EM Strategy, we discussed that we were buyers of the MSCI EM (EEM-US) on a pullback to the 50-day MA. 
The pullback went a bit deeper but managed to hold at our $37.50 line-in-the-sand which we discussed in our recent ETF Pathfinder reports (Mar. 6 and Mar. 20, 2023).
The EEM-US displays a bullish 2-month downtrend reversal- add exposure. Signs continue to point to a topping DXY, and a declining DXY has historically resulted in EM outperformance (vs. EAFE).


MSCI EM $EEM 2-Month Downtrend Reversal at Support -- Add Exposure. Upgrading Taiwan to Overweight

<ul>
<li>The MSCI EM vs.EAFE ratio (local currency) shows EM has outperformed relative to EAFE since the DXY peaked in November 2022, and also shows signs of reversing the 2-year downtrend.</li>
<li>As long as the DXY remains below $103.50-$106, we expect outperformance from EM to continue.</li>
<li>China/Hong Kong, Greece, South Africa, and Mexico stand out as attractive countries. Our top actionable Sectors include Communications, Consumer Discretionary, and Technology. We highlight 76 attractive EM stocks.</li>
</ul>


The MSCI EM vs.EAFE ratio (local currency) shows EM has outperformed relative to EAFE since the DXY peaked in November 2022, and also shows signs of reversing the 2-year downtrend.
As long as the DXY remains below $103.50-$106, we expect outperformance from EM to continue.
China/Hong Kong, Greece, South Africa, and Mexico stand out as attractive countries. Our top actionable Sectors include Communications, Consumer Discretionary, and Technology. We highlight 76 attractive EM stocks.


EM Outperformance to Continue (Vs. EAFE) -- Add on a Pullback; DXY Needs to Hold Below $106

Mexico

The MSCI Mexico Index is a free-float weighted equity index.

MSCI Mexico Index (MXMX INDEX)

Actinver Research - Macro Daily: Banxico Quarterly Report

Banco de México (Banxico) presented its Quarterly Report yesterday, in which it reinforces the idea that the rate cut on August 8th was justified...

Actinver

Portfolio Watch: What if We Add a Rate Cut to This Fire..

The cyclical rotation is slowly but slowly rolling and if central banks add rate cuts to this mix, we are staring directly into the melt...

Steno Research

Pause/Pullback Underway; Downgrading Europe and Mexico; Buys in Services, Tech, Comm, Healthcare

Pause/pullback underway in $ACWI, but as long as the $DXY remains below $106, the 10-year Treasury yield remains below 4.35%, and $ACWI is above...

Vermilion Research

MSCI EM $EEM 2-Month Downtrend Reversal at Support -- Add Exposure. Upgrading Taiwan to Overweight

Signs continue to point to a topping $DXY, and a declining DXY has historically resulted in EM outperformance (vs. $EAFE). Many ideas in China/Hong...

Vermilion Research

EM Outperformance to Continue (Vs. EAFE) -- Add on a Pullback; DXY Needs to Hold Below $106

EM vs. EAFE ratio (local currency) shows EM has outperformed relative to EAFE since the $DXY peaked in November 2022. If the DXY remains below...

Vermilion Research