Thematic (Sector/Industry)

• There are signs that the South Korean REIT market may have bottomed in the past 3-6 months after significant market underperformance from 2021 to 4Q 2023.
• The 16 major Korean REIT stocks are up on average 5% YTD, outperforming KOSPI which is up 1.4% in the same period.
• Differential in REIT dividend yield/Korean bond yield, meaningful discount to NAV, and increased capital allocation from Corporate Value Up program have been driving outperformance of Korean REIT stocks this year.

• The Dow Jones Industrial Average closed higher on Wednesday as Federal Reserve Chair Jerome Powell’s comments eased concerns over potential rate hikes amidst inflation worries
• Profits rise at over two-thirds of major Japanese public companies for the fiscal year ending in March, attributed to factors like a weak yen, price hikes, and a tourism rebound.
• Japanese Prime Minister Fumio Kishida’s cabinet maintains a 26% approval rating, while the disapproval rating rises to 69%

• 300274 SZ/601012 CH: A fire broke out in JinkoSolar’s Shanxi factory may benefit the entire supply chain.(///)
• 1810 HK /XPEV US/LI US : Tesla passed all 4 national automotive data security requirements, Musk made a surprise visit to China and was received by Li Qiang （/////）
• 1810 HK: Pony.ai formed JV with Toyota to prepare for robotaxi（/）

• TCOM US/ATAT US: The increase in rainfall will negatively impact travels during the Labor Day holiday.(-/-)
• META US/MSFT US /GOOGL US /SNAP US: The application of AI in advertising on short video and social platforms may result in greater efficiency than search advertising.（///////）
• 3690 HK: Meituan plans to expand into the Middle East Riyadh via KeeTa.（-）

• This earnings post will be a bit less detailed than usual. I just finished a move mid-earnings, and it was insanely distracting. So, I’ll start with the spark notes before I go into depth.

• Industrial (TXN) is possibly bottoming, Automotive is probably bottoming (TXN), but SiC (STM) is doing much worse, and mobile (TER) hasn’t changed quite much. Consumer (NOD) got a substantial call out.

• Telecom (MXL, INTC) is about to bottom imminently. I continue to like MaxLinear and other companies that are exposed to telecom. HBM (TER, SK) continues to be strong. In Semicap, Logic is strong, HBM is strong, and China is declining less than expected.

• April proved challenging for markets, with the Dow recording its worst monthly performance since September 2022, down 5%.
• After hours, Advanced Micro Devices fell over 7% despite slightly beating revenue estimates at $5.47 billion, with gaming segment revenue down 48%
• Super Micro Computer dropped almost 8% despite beating earnings estimates

• Siltronic cut its 2024 sales revenue forecast by 10% just days ahead of their Q124 earnings release
• Inventory levels, while gradually improving, are still at all time record highs
• In the case of Siltronic, it seems likely that Automotive end-market weakness is the main culprit

• The Japanese yen saw significant volatility, briefly falling below 160 against the U.S. dollar on Monday morning, marking a fresh 34-year low, then rebounding to 156.40
• U.S. hedge fund Elliott Management has reportedly acquired a stake in Sumitomo Corp. valued at tens of billions of yen, potentially signaling an activist shareholder push
• Shares in Tesla surged over 15% on news of partnership with Baidu paving way for offering self-driving in China

• Fiscal 4Q 2024 results have shown the first signs of a bottoming in y/y constant currency revenue growth rates, leading to expectations for accelerating growth rates over the medium term.
• We have witnessed a steady long-term negative trend in operating margins for most of the industry.
• Forward PE ratios are at, or above, long-term historic average trading levels. We find very little upside for these shares whilst maintaining a relative preference for Infosys Ltd (INFO IN).

• We are at an unprecedented moment in history where USDJPY is breaking 34-year high.  At the same time, all Asia EM currencies (except CNY) are seeing strong depreciation pressure
• What’s happening behind the scene?  We look at the underlying reasons and SHORT trades.  The implication is huge and we need to assess what will happen
• Depending on what Central Banks will do (intervention?), we try to access if there is risk of another Asia Financial Crisis.  We look at potential trades to bet on

• BHP’s bid for Anglo American highlights the value currently in the mining sector
• Chinese material stocks outperforming and the world is following suit
• Speculative buying exhaustion may prompt a correction in copper and provide a good entry point.

• We discuss the recent developments and financial performance of Indian Life Insurers note in this Primer
• The big news this quarter is that a significant regulatory risk has passed on without any dent. This has turned the outlook on the sector more positive.
• Expect a secular low-mid double-digit premium growth for the Neutral on HDFCLIFE IN Short on IPRU IN and LICI IN

• Residential furniture and home goods retailer issues performed well last week versus the market, while the Commercial/Contract Furniture stocks, by and large, tread water.
• Our Residential Manufacturers & Suppliers index advanced 3.2%, outperforming the broader market indexes (up between 1.6 to 1.8%), while our Home Goods Retailers and Mass Retailers indexes each grew by 0.7%.
• Only our Commercial/Contract Furniture Index lagged, down 0.3%.

• It was another quiet week across cannabis. The US cannabis MSOS ETF returned 0.23%, while the global YOLO ETF dropped 0.26%.
• While the plant and support for federal reform have never been more popular, real progress continues to be held hostage by politicians.
• While there are reasons to think reform could be imminent, soon, or in the days ahead, investors are becoming impatient with empty promises.

• Weekly high frequency data on US banks shows a major slow down continuing in residential mortgage loan growth
• Mortgage loan applications index shows some of the worst figures in years in the latest weekly data
• Core net interest income and credit costs can surprise even from an area that is traditionally not risky compared with CRE and C&I loans

• Indian household savings seeing a significant transition from traditional assets to financial assets
• More than transition, there is a transformative trend ahead for financialization of savings paving way for Indian Households a decadal opportunity of wealth creation
• What happened in US could happen in India over the next few decades – Significant wealth creation opportunity

• The Global Emerging Markets Weekly summarizes the key news and related developments impacting the largest countries and constituents of the Global Emerging Markets equity indices.
• Macro data points: South Korea 1Q 2024 GDP growth report.
• Companies mentioned:Tencent (700 HK), Bharti Airtel (BHARTI IN), Meituan (3690 HK)

• This paper contrasts performance of integrated oil exploration and refining firms (“Explorers”) with oil refineries (“Refiners”).
• Hypothesis is that Refiners outperform Explorers when the crack spread widens. Back testing based on select firms proves the hypothesis.
• This paper posits that Refiners will outdo Explorers when crack spreads tear based on historical performance.

• For the week, the Nikkei ended up 2.34%, while the Topix gained 2.29%.
• Japan’s 10-year government bond yield reached six-month highs, exceeding 0.9%, amidst the BOJ’s unchanged interest rates.
• Shares of Zeon rose by +17% this week after the company reported 4Q3/24 operating profits of ¥4.5 bn, surpassing analyst estimates

• JD/BABA/2618.HK/6690.HK/000333.SH/000651.SH/1810.HK: Some cities have begun to roll out “Trade Old in for New” home appliance  subsidies (+)
• 700 HK: Source suggested that <Black Myth: Wukong> will commence pre-sales on Tencent’s WeGame platform on May 19th.(+)
• SHEIN: SHEIN launches support for self-operating 3P merchants in Europe (+)

• AUCTUS PUBLICATIONS ________________________________________ ADX Energy (ADX AU)C; target price of A$1.00 per share: Important step to unlock Sicily – The Italian ministry has informed ADX that it will be granted the d 363C.R-.AX gas exploration permit in the Sicily Channel.
• In addition, the Regional Administrative Court of Rome has annulled the Plan for the Sustainable Energy Transition of Eligible Areas that prevented the oil redevelopment, appraisal and exploration activities on the licence.
• The annulment, if not contested, will result in reversion to the 2018 legislation enabling oil as well as gas within the d 363C.R .AX permit to be exploited.

• 9926 HK/1801 HK/BGNE US/9995 HK: Stablization of insulin NDRL price suspected major changes in medical insurance policies(///////)
• LI US/1810 HK/1211 HK/NIO US/XPEV US: In the 16th week of 2024, the growth rate of new energy vehicles slowed down, LI showed negative growth, AITO rebounded, Xiaomi fell back（/////////）
• 1810 HK/XPEV US/NIO US/LI US: Takeaways from Xiaomi Investor Conference (+/-/-/-)

• Tesla had a dismal quarter but Musk told a fairy tale about RoboTaxis and Robots and the markets rejoiced
• Meta had a beat & raise quarter but Zuckerberg told the truth about the fact that it would take time to monetise their AI investments and the markets recoiled
• Markets are on edge and big moves either way can be expected post earnings

• Stocks retreated on Thursday following disappointing US GDP data for Q1, with the Nasdaq Composite down 0.6%
• The world’s largest technology companies soared after hours as stellar results from Microsoft Corp. and Google’s parent Alphabet Inc. provided some relief  
• Toyota to invest $1.4 billion in its Indiana plant to support electrification efforts in the U.S., preparing for the production of a new battery electric SUV

• This note is a weekly curated selection of Chinese news articles and company announcements focused on developers in distress
• We look for their deals, updates, specific project progress news (‘local signals’), as well as relevant local research commentaries about the market
• We do not verify the underlying data or provide any opinion, we only select and summarize the information; See direct links to sources

• Odd Lots podcast discusses the three body problem as an allegory for US-China tech rivalry
• Discussion on the allegorical interpretations of the three body problem in relation to US-China rivalry in tech, specifically in AI
• Interview with Damien Ma, managing director at Macro Polo, discussing the Global AI Talent Tracker and the importance of tracking AI talent trends

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• U.S. stocks closed mixed, with the S&P 500 and Nasdaq Composite up for a third consecutive day. The Dow Jones saw its first decline in five sessions.
• The Japanese yen declined to its weakest levels against the dollar since 1990, raising concerns about intervention from Japanese authorities
• Asahi Kasei plans to invest around 200 billion yen ($1.3 billion) in a new plant in Canada to produce components for electric vehicle batteries

• 1810HK/LI:Tesla cuts prices of all series by 14,000yuan to compete with Xiaomi SU7 and LI L6,with the fomer facing long time of delivery and the latter had a mediocre start(//-)
• LI US: LI cuts price for all series, might be due to difficulty to achieve delivery targets (/)
• LKNCY US: New products fail to bring meaningful incremental DAU growth, bodes ill for 2Q24 sales(-)

• 700 HK: Tencent’s “Dungeon & Fighter Mobile” is officially scheduled to be released on May 21st.(+)
• 3690 HK/TCOM US: Meituan and Ctrip revenue growth may lower than industry average, indicating intensified competition.(-/-)
• BIDU US: Baidu ADS sets revenue and profit indicators for Robotaxi（/）

• This in-depth analysis of consumption data shows the level of caution among consumers caused by inflation and fears of more price rises to come. 
• Food expenditure has risen to a record high due to higher prices and this has curtailed spending in other categories like fashion for most income classes.
• Savings rates are at record levels, however, boosting opportunities for the better brands and retailers. If wages rise in real-terms, then consumer confidence is likely to rebound.

• Japan’s domestic credit growth is now running at 4.2% YoY in the latest month in February 2024.
• The slope of Japan’s domestic credit growth is greater than all developed Asia Pacific peer countries.
• Weaker JPY can further raise interest in tourism, and USD translation of earnings for megabanks.

• Airlines are among biggest accounting manipulators worldwide, AI tool shows
• Airlines are more assertively managing their accounting as they struggle to reinvigorate profits hurt by Covid-19 pandemic
• Chinese, Asian carriers have highest risk scores for accounting manipulation

• US stocks rallied on Tuesday with the Nasdaq Composite leading, up 1.6% on upbeat earnings. 
• Speculation swirls on timing of next BOJ rate hike as policymakers gather for two-day meeting starting Thursday.
• Mitsui joins a liquefied natural gas (LNG) project in the UAE, investing in a $7 billion venture to produce 10 million tons annually, about 15% of Japan’s demand.

• In 2022, there were 20 million new cancer cases, and almost half of the cases were recorded in Asia.
• Global oncology spend is forecast to grow at 11.99% between 2023 and 2027, and this is expected to be almost three times faster than the growth of total pharma spend.
• Emerging companies continue to make big strides in oncology drug development and made up 71% of the new drug pipeline in 2022.

• The strong showing of economic data from the US for the first three months of 2024 has spurred bets that the Federal Reserve’s is going to delay cutting rates towards the latter half of this year.
• The narrative surrounding ‘imminent’ rate cuts that dominated market perception near the end of last year has been thwarted by the Fed’s chair Jerome Powell suggesting that rates are likely to remain elevated, without the market completely discounting the possibility of further rate hikes.
• The immediate fallout from the higher-than-expected March inflation figures led to a systematic drop in Asian currencies, especially for some ASEAN based currencies, such as the Malaysian Ringgit, that have already been embattled by weakening currency against the dollar since the start of this year.

• Stocks surged Monday, bouncing back from last week’s losses, boosted by a tech rebound and eased Middle East tensions
• Japan and Europe will cooperate in recycling EV batteries by establishing a system to share information
• Ricoh has acquired German startup Natif AI, leveraging its artificial intelligence (AI) technology for automatic information extraction from text.

• With US inflation figures higher than expectations, there is an increase in risk that the Fed’s next move may be a hike.  Some HSI constituents are set to benefit.
• Orient Overseas International (316 HK), Budweiser Brewing APAC (1876 HK), and Galaxy Entertainment Group (27 HK) have significant USD net cash position and will be gainers.
• Sunny Optical Technology Group (2382 HK) and Haier Smart Home (6690 HK) have large China operations but they are net long on USD balance and this will make them beneficiaries.

• After a bumper bonus during Covid, the fashion sector saw calmer spending in the last 18 months as the big return to shops led to more muted growth online. 
• The overall EC fashion market grew around 4-7% depending on how you measure it, but online market share actually fell as people went back to shops.
• This in-depth review highlights the key trends in the sector as well as the winners by sales growth among retailers and fashion brands.

• New quarterly data from Zions shows huge growth in time deposits, and also far worse credit metrics in commercial real estate and home equity loans
• Cadence reveals incredibly high growth of net charge offs in the year, but also far worse credit costs and NPLs
• None of this should surprise, and we remind that often banks reveal worsening credit metrics with some lag – it not always immediate, neat, simple

• Power Industry in India is no stranger to regulations – the industry has battled with regulatory changes since India’s independence in 1947.
• Most of these changes in recent years, have focused on strengthening the sector and making it more efficient. Some of these regulations have worked, while others have failed miserably.
• The Electricity Amendment Bill of 2021, is different. It focuses on the root causes of the problem and devises solutions accordingly, rather than try fixing them with a Band-Aid (as previous regulations did).

• Its a quarter too soon to go dumpster diving in the automotive semiconductor industry. Another round of cuts is likely coming. Consider this my earnings preview.

• I have leaned bearish automotive semiconductors for a few months, and I think the call has been mostly correct.

• For me, the beginning of my bearishness started when I highlighted that China would try to murder the supply aspect of the market for the foreseeable future

• The year is 1999, India’s total GDP back then was less than RBI’s Forex Reserves today .
• It had been a few years since economic liberalization of 1991 and internet companies were all the rage in international stock markets.
• Domestically too, in India, a little known Indian software business by the name of Infosys has started to grab headlines .

• Our Commercial/Contract Furniture Index was up 0.6% for the week, notably outperforming the three market indexes and the Mass Retailers Index (down between 1.4% and 3.2% for the week).
• Our Residential Manufacturers & Suppliers Index (down 3.5%) and Home Goods Retailers Index (down 2.9%) were more in line with the broader market indexes.
• Home goods retailer Beyond sold the Wamsutta brand/IP to Indo Count Global for $10.3 million as the firm focuses on integrating its purchase of Bed, Bath, and Beyond into its portfolio of online properties.

• AI detectors are not very effective, leading to the solution of grading AI-generated essays as regular essays
• Chat GPT essays are currently at a C level, serving as the baseline for comparison
• The use of AI in industrial applications, specifically robotics, is a growing area of interest for investment and development

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• The WTR Sustainable Index was up down 3.9% W/W versus the S&P 500 Index (down 3.0%), the Russell 2000 Index (down 2.8%), and the Nasdaq Index (down 5.4%).
• Energy Technology (12.0% of the index) was down by 6.6%, while Industrial Climate and Ag Technology (58.1% of the index) was down by 2.2%, ClimateTech Mining was down 5.9%, and Advanced Transportation Solutions (23.4% of index) was down 6.7%.
• Top 10 Performers: FSR, PNPN, VTNR, AMMP, TLO, WML, KNDI, GOEV, BMI, CRGE