Quantitative Researcher, MRM Research

Nico Rosti

Quantitative Researcher

MRM Research

Quantitative Research

Event-Driven

<ul>
<li>The Nikkei 225 index closed up last week and it has a good probability to rise further this week: the MRM tool has identified the current pattern as "bullish".</li>
<li>
<strong>Resistance targets</strong> are located <strong>past 33500</strong>, the index could reach that target this week.</li>
<li>If the index rises for 3 weeks or more, it could breakout from the previous resistance range around 33700, and reach targets past 34000.</li>
</ul>


The Nikkei 225 index closed up last week and it has a good probability to rise further this week: the MRM tool has identified the current pattern as "bullish".

Resistance targets are located past 33500, the index could reach that target this week.
If the index rises for 3 weeks or more, it could breakout from the previous resistance range around 33700, and reach targets past 34000.


EQD | Nikkei 225 (NKY) WEEKLY Resistance Targets

Research and consultancy, Tabbush Report

Daniel Tabbush

Research and consultancy

Tabbush Report

We provide research and consultancy on Asian banks. Our focus is on what we call “Asian bank research, without the noise.” We are interested in the most critical swing-factors for banks, the NPL and credit cycle, and where we believe there is a gap between perception and reality. We often focus on the less studied components of bank financial statements.  Our research is highly thematic, sometimes examining unlisted banks and companies as a window on mainstream banks. 

Being independent allows us to look at smaller banks, often overlooked by others. Analysis of BIS bank guidelines in the context of Asia, is also a focal point, while we also analyze global banks operating in the region. We use what we believe is the most comprehensive, reliable financials database, SNL Financial. S&P Capital IQ augments our database, with corporate data and CEIC, with economics. 

Asian bank research, without the noise.

Equity Bottom-Up

Sumitomo Mitsui Financial Group (Sponsored Adr) / Equity Bottom-Up

Sumitomo Mitsui Financial Group (Sponsored Adr)

<ul>
<li>SMFG achieved less of its FY24 profit forecast than peer megabanks; less upgrades</li>
<li>SMFG reported a far lower ROE than peer megabanks &amp; some worse financial metrics</li>
<li>SMFG's JPY bonds are only 0.88x of total equity; it is less leveraged than peer megabanks</li>
</ul>


SMFG achieved less of its FY24 profit forecast than peer megabanks; less upgrades
SMFG reported a far lower ROE than peer megabanks &amp; some worse financial metrics
SMFG's JPY bonds are only 0.88x of total equity; it is less leveraged than peer megabanks


SMFG - Least Achieved of FY24 Forecast, With Lowest ROE of Mega's & Less JPY Bond Leverage

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

<ul>
<li>There are 38 adds/36 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 4.35% and a two-way trade of JPY 461bn (US$3.24bn).</li>
<li>There are a few stocks that will have same way flow from other index trackers within a few weeks of the JPX Nikkei 400 Index rebalance.</li>
</ul>


There are 38 adds/36 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 4.35% and a two-way trade of JPY 461bn (US$3.24bn).
There are a few stocks that will have same way flow from other index trackers within a few weeks of the JPX Nikkei 400 Index rebalance.


JPX Nikkei 400 Index Rebalance: Some Big Impact Names

Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Thematic (Sector/Industry)

<ul>
<li>BoJ’s tweaking of yield curve controls places Japanese financials on a more positive investment footing, and given the modest valuations, there is healthy potential for further re-rating</li>
<li>We assess the large-cap and select mid-cap Japanese commercial banks’ exposures to JGBs and foreign sovereign bonds and their loan books’ gearing to the prospect of higher rates</li>
<li>We see value, in particular, in Resona, Mizuho and SMFG with attractive valuations supported by modest LDRs, good loan sensitivity to higher rates and relatively modest exposure to JGBs</li>
</ul>


BoJ’s tweaking of yield curve controls places Japanese financials on a more positive investment footing, and given the modest valuations, there is healthy potential for further re-rating
We assess the large-cap and select mid-cap Japanese commercial banks’ exposures to JGBs and foreign sovereign bonds and their loan books’ gearing to the prospect of higher rates
We see value, in particular, in Resona, Mizuho and SMFG with attractive valuations supported by modest LDRs, good loan sensitivity to higher rates and relatively modest exposure to JGBs


Japanese Banks – Our Picks for a Steepening Yield Curve

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

EURO STOXX 50 Price EUR / Technical Analysis

<ul>
<li>As discussed in our previous Int'l Compass (June 29, 2023), we are bullish on global equities (MSCI ACWI) as long as ACWI-US is above $93, targeting $110</li>
<li>Bullish developments have continued: DXY breaking below $101-$101.50, RS bottoming for small-caps, MSCI ACWI ex-U.S. (ACWX-US) 1+ year breakout above $50, Italy's FTSE MIB breaking above multi-year resistance at 28,100.</li>
<li>This is only further evidence supporting our bullish outlook. We are getting the breakout above 4400-4415 on the EURO STOXX 50 that we've been expecting. Buys in Energy, Materials, Financials</li>
</ul>


As discussed in our previous Int'l Compass (June 29, 2023), we are bullish on global equities (MSCI ACWI) as long as ACWI-US is above $93, targeting $110
Bullish developments have continued: DXY breaking below $101-$101.50, RS bottoming for small-caps, MSCI ACWI ex-U.S. (ACWX-US) 1+ year breakout above $50, Italy's FTSE MIB breaking above multi-year resistance at 28,100.
This is only further evidence supporting our bullish outlook. We are getting the breakout above 4400-4415 on the EURO STOXX 50 that we've been expecting. Buys in Energy, Materials, Financials


Bullish Developments Continue; MSCI ACWI Ex-US 1-Yr Breakout; Buys in Energy, Materials, Financials

Japan

Sumitomo Mitsui Financial Group, Inc. is a holding company established by Sumitomo Mitsui Banking Corporation.  Sumitomo Mitsui Card Co., SMBC Leasing Co., and The Japanese Research Institute, Ltd. joined the Group in Feb., 2003. The Company manages financial operations for its subsidiaries.  The Group provides commercial banking and a variety of financial services.

Sumitomo Mitsui Financial Group (Sponsored Adr) (SMFG US)

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Sumitomo Mitsui Financial Group (Sponsored Adr) (SMFG US)

EQD | Nikkei 225 (NKY) WEEKLY Resistance Targets

A tactical short-term WEEKLY analysis of the Nikkei 225 resistance levels: bullish pattern, the index can rise +1 week or more, but it will...

Nico Rosti

SMFG - Least Achieved of FY24 Forecast, With Lowest ROE of Mega's & Less JPY Bond Leverage

SMFG has achieved less of its FY24 forecast than peer mega banks, with a lower ROE, higher credit costs, higher operating costs, and less JPY bond...

Daniel Tabbush

JPX Nikkei 400 Index Rebalance: Some Big Impact Names

There are 38 adds and 36 deletes for the JPXNK400 Index. The adds have outperformed the deletes and there is a fair bit to trade on a lot of...

Brian Freitas

Japanese Banks – Our Picks for a Steepening Yield Curve

We assess Japanese commercial banks’ exposures to JGBs and foreign sovereign bonds and their loan books’ gearing to the prospect of higher rates,...

Victor Galliano

Bullish Developments Continue; MSCI ACWI Ex-US 1-Yr Breakout; Buys in Energy, Materials, Financials

We remain bullish on global equities as long as $ACWI remains above $93, targeting $110; Bullish developments continue: $DXY below $101.50, small...

Vermilion Research

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52-week Range

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