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

Event-Driven

<ul>
<li>It was a busy week with index rebalance implementations and announcements of index changes.</li>
<li>The coming week has the KOSPI200 and KOSDAQ150 rebalancing on Thursday and a bunch of onshore China indices rebalancing on Friday.</li>
<li>There were big inflows to China ETFs during the week while the largest inflows went to the <a href="https://www.smartkarma.com/entities/tracker-fund-of-hong-kong-ltd" target="_blank" data-smartkarma-citation="entities:29257:1" rel="noopener">Tracker Fund of Hong Kong Ltd (2800 HK)</a> ETF.</li>
</ul>


It was a busy week with index rebalance implementations and announcements of index changes.
The coming week has the KOSPI200 and KOSDAQ150 rebalancing on Thursday and a bunch of onshore China indices rebalancing on Friday.
There were big inflows to China ETFs during the week while the largest inflows went to the Tracker Fund of Hong Kong Ltd (2800 HK) ETF.


Index Rebalance & ETF Flow Recap: CSI300/500, Chinext, China Semi Chips, Nifty Next50, SET50, REMX

<ul>
<li>NSE Indices have started a market consultation on dropping stocks that are not a part of the Futures &amp; Options segment from the <a href="https://www.smartkarma.com/entities/nifty-next-50-index" target="_blank" data-smartkarma-citation="entities:36053:1" rel="noopener">Nifty Next 50 Index (NIFTYJR INDEX)</a>. </li>
<li>This will be done in two phases with a weight reduction for non-F&amp;O stocks in June and deletion from the index in September.</li>
<li>That will result in 11 inclusions to the <a href="https://www.smartkarma.com/entities/nifty-next-50-index" target="_blank" data-smartkarma-citation="entities:36053:1" rel="noopener">Nifty Next 50 Index (NIFTYJR INDEX)</a> in September and bring in a lot of flow to the stocks.</li>
</ul>


NSE Indices have started a market consultation on dropping stocks that are not a part of the Futures &amp; Options segment from the Nifty Next 50 Index (NIFTYJR INDEX). 
This will be done in two phases with a weight reduction for non-F&amp;O stocks in June and deletion from the index in September.
That will result in 11 inclusions to the Nifty Next 50 Index (NIFTYJR INDEX) in September and bring in a lot of flow to the stocks.


NIFTY NEXT 50 Index Market Consultation: Non-F&O Stocks Could Be Dropped

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>There continues to be little traction above $93 on MSCI ACWI (ACWI-US), which remains the top-end of our anticipated 2023 trading range. Important downside targets are $86, $84, and $75-77.</li>
<li>Additionally, the EURO STOXX 50 remains below 2-year resistance at 4400-4415.</li>
<li>We remain overweight Europe, Japan, and India, and we prefer to only add exposure on a pullback -- especially in Japan where indexes are bullish yet extended.</li>
</ul>


There continues to be little traction above $93 on MSCI ACWI (ACWI-US), which remains the top-end of our anticipated 2023 trading range. Important downside targets are $86, $84, and $75-77.
Additionally, the EURO STOXX 50 remains below 2-year resistance at 4400-4415.
We remain overweight Europe, Japan, and India, and we prefer to only add exposure on a pullback -- especially in Japan where indexes are bullish yet extended.


No Traction Above $93 on ACWI-US or 4400-4415 on EURO STOXX 50. Buys in Defensives/Japan/EM

TSE Tokyo Price Index TOPIX / Technical Analysis

<ul>
<li>We continue to recommend a tactical overweight to defensives (Staples, Health Care, and Utilities) as the MSCI ACWI (ACWI-US) tests the top-end of our anticipated 2023 trading range at $93.</li>
<li>We also remain overweight Europe, Japan, and India, where a lot more than just defensives continue to outperform.</li>
<li>Actionable Themes: Consumer Discretionary and Defensives, Mainly in Japan and Europe</li>
</ul>


We continue to recommend a tactical overweight to defensives (Staples, Health Care, and Utilities) as the MSCI ACWI (ACWI-US) tests the top-end of our anticipated 2023 trading range at $93.
We also remain overweight Europe, Japan, and India, where a lot more than just defensives continue to outperform.
Actionable Themes: Consumer Discretionary and Defensives, Mainly in Japan and Europe


Remain Overweight Japan, Europe, & India; Buys in Discretionary and Defensives W/ Japan/Europe Focus

Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

Zydus Lifesciences Ltd / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/zydus-lifesciences-ltd" target="_blank" data-smartkarma-citation="entities:12914:1" rel="noopener">Zydus Lifesciences Ltd (ZYDUSLIF IN)</a> recorded 32% growth in revenue to INR50B in Q4FY23, driven by 58% YoY growth in US formulation business. India business revenue grew 11% YoY.</li>
<li>US business growth was driven by volume expansion in existing products and new launches. The company has launched eight new products in the US during the quarter.</li>
<li>Going ahead, growth is expected to moderate, due to high base effect. The company expects single-digit growth in the US business in FY24, slower than 28% growth recorded in FY23.</li>
</ul>



Zydus Lifesciences Ltd (ZYDUSLIF IN) recorded 32% growth in revenue to INR50B in Q4FY23, driven by 58% YoY growth in US formulation business. India business revenue grew 11% YoY.
US business growth was driven by volume expansion in existing products and new launches. The company has launched eight new products in the US during the quarter.
Going ahead, growth is expected to moderate, due to high base effect. The company expects single-digit growth in the US business in FY24, slower than 28% growth recorded in FY23.


Zydus Lifesciences (ZYDUSLIF IN): Strong Q4 Result Driven by US Business; Forward Growth to Moderate

India

Cadila Healthcare Ltd. manufactures, and markets healthcare solutions ranging from formulations, active pharmaceutical ingredients, vaccines, diagnostics, health and dietetic foods, animal healthcare to cosmeceuticals.  The Company's products are available in tablets, capsules, injections, liquids, dry syrups, powders, granules, and ointments.

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Zydus Lifesciences Ltd (ZYDUSLIF IN)

Index Rebalance & ETF Flow Recap: CSI300/500, Chinext, China Semi Chips, Nifty Next50, SET50, REMX

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

NIFTY NEXT 50 Index Market Consultation: Non-F&O Stocks Could Be Dropped

A market consultation could lead to the deletion of non-F&O stocks from the NIFTY NEXT50 index in September. That means 11 new index members and...

Brian Freitas

No Traction Above $93 on ACWI-US or 4400-4415 on EURO STOXX 50. Buys in Defensives/Japan/EM

No Traction Above $93 on MSCI $ACWI or 4400-4415 on EURO #STOXX 50. Continues to reinforce our view from early-January that $93 on ACWI caps upside...

Vermilion Research

Remain Overweight Japan, Europe, & India; Buys in Discretionary and Defensives W/ Japan/Europe Focus

We continue to recommend a tactical overweight to defensives as $ACWI tests the top-end of our anticipated 2023 trading range at $93. Remain...

Vermilion Research

Zydus Lifesciences (ZYDUSLIF IN): Strong Q4 Result Driven by US Business; Forward Growth to Moderate

Zydus Lifesciences recorded 32% revenue growth to INR50B in Q4FY23, driven by 58% growth in US formulation business. The company expects single...

Tina Banerjee

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