Thematic (Sector/Industry)

OVERSEAS: SPX +0.4%; stocks shrug off moves in the bond market as 10-Years hit 4.54%, highest level since 2007
JAPAN: NKY futs -0.6% v cash, JPY 148/$; PM Kishida unveils new tax breaks for semiconductor production
JAPAN X: Toyota is making significant strides in revolutionizing its electric vehicle (EV) manufacturing with the adoption of “gigacasting” technology

China TMT Update-700.HK/NTES.US.2400.HK.ZTO/2352/BABA/PDD/U-Game Code/Parcel Volume Remains Strong

HK 700/NTES US/HK 02400: NPPA has released the game code approvals for September, but Tencent and NetEase is not on the list (-)/(-)/(+).
ZTO/002352.CH/BABA/PDD: Parcel volume remains strong, grew 23% YoY last week (+)
U: Unity Issues Formal Apology and Adjusts Previous Runtime Fee Plans (-)

China TMT Update-NIO/BYD/XPEV/NIO/TSLA-August EV Export Growth Decelerated/NIO’ S Sales in Europe

NIO ：NIO’ s sales in Europe grew rapidly in August（+）
BYD/XPEV/NIO/TSLA: Chinese new energy vehicles no longer meet French electric vehicle subsidy standards（-）
August EV export growth decelerated, batttery export growth rebound while inverter in price war (-)

[Blue Lotus Sector Update]: Chinese Renewable Energy Comes to Crossroads

Contrast to weak EV demand and solar PV inventory correction abroad, domestic renewable capacities have been growing at such a neck-breaking speed that we foresee a utilization drop in 2023;
China’s firm and consistent renewable policy and a unified energy vision have been its strength,
But now have developed a few inconsistencies. Resolution of inconsistency push the sector to higher grounds.

Furniture/Furnishings Weekly – SCS Results Boost Commercial/Contract Furniture Sector

In a week when the broad market indexes retreated by ~3%, the positive earnings report from Steelcase, Inc. (SCS) provided a boost for all the Commercial/Contract Furniture issues.
SCS results supported a view that demand in the office furniture sector had troughed.
CFO Dave Sylvester noted that the weekly pace of orders in its Americas segment was steady through its fiscal 2Q and into 3Q and that the Y/Y order comparison for the first few weeks of September was up by ~18%. For details, see our update note from September 22.

The Highlights – Cannabis News for the Week Ending September 22, 2023

Global equities sold off this week after more hawkish language from the Federal Reserve. The MSCI World Index fell 2.77%, while the S&P 500 dropped 2.92%.
The Fed kept rates at 5.25-5.50% but warned additional rate hikes are possible.
The NASDAQ declined 3.62%, while the small-cap Russell 2000 finished the five days down 3.78%.

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Sep 25

Daily Brief Thematic (Sector/Industry): Ohayo Japan: SPX -2.9%WoW as UAW Auto Strikes Expand; JapanX – Nintendo Is THE Prime Gaming Asset and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

Ohayo Japan: SPX -2.9%WoW as UAW Auto Strikes Expand; JapanX – Nintendo Is THE Prime Gaming Asset
2023Q4 A-Share Market Outlook and the Potential Sino-US Deals – Time to Go Long?

Ohayo Japan: SPX -2.9%WoW as UAW Auto Strikes Expand; JapanX – Nintendo Is THE Prime Gaming Asset

OVERSEAS: The S&P 500 lost 2.9% last week, its worst performance since March; US Auto Strike expands; US budget talks fail – Govt shutdown risk rises.
JAPAN: Nikkei ends the week down -3.4%; BOJ downplays policy exit; Japan Core Inflation remains at 3.1%
JAPAN X: Phil Spencer, the head of gaming at Microsoft, was found to have expressed keen interest in acquiring Nintendo

2023Q4 A-Share Market Outlook and the Potential Sino-US Deals – Time to Go Long?

By Xinyao (Criss) Wang

How long the Fed has to maintain high interest rates sometimes does not entirely depend on the US itself, but also depends on whether other countries are willing to “cooperate”.
As China and the US have entered deeper negotiations, investors are looking forward to some big deals, but they may also need to be psychologically prepared for “not meeting expectations”.
Since the biggest problem restricting foreign investment inflows has been solved, incremental funds are coming. The real A-share bull market may not come until the RMB officially enters sustained appreciation channel.

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Sep 24

Daily Brief Thematic (Sector/Industry): US Large Banks – New B/S Data: CRE Craters and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

US Large Banks – New B/S Data: CRE Craters, MBS Sharp Decline, LLR & Big Fixed Deposits Up+, SE Flat
Auctus on Friday – 22/09/2023

US Large Banks – New B/S Data: CRE Craters, MBS Sharp Decline, LLR & Big Fixed Deposits Up+, SE Flat

By Daniel Tabbush

US large banks are showing more cash emphasis in the latest weekly data, increased signs of risk aversion, with MBS in sharp decline and CRE loans
Loan loss reserves continue to rise at over 18% YoY, and this will mean that banks are taking a lot more credit costs, impacting returns, net profit growth
Large time deposits accelerating, up 88.0% YoY in the most recent week; with all of these points, perhaps it is no wonder that shareholders’ equity is stagnant?

Auctus on Friday – 22/09/2023

By Auctus Advisors

ADX Energy (ADX AU)C ; target price of A$0.08 per share : Completing farm-out transaction in Austria – The farm-out transaction of Anshof to MND has now completed with an initial payment of EUR1.93 mm.
MND has further Anshof development funding obligations of EUR4.683 mm for the drilling, completion and tie-in of the Anshof-2 and Anshof-1 wells as well as payment of further contingent amounts of EUR1.335 mm and EUR3.57 mm (A$ 5.95 million) if the Anshof-2 well meets agreed production performance criteria.
Arrow Exploration (AXL LN/CN)C ; target price of £0.55 per share: Good flow rate in the C7 at CN-3 – A 23 ft pay zone (25% porosity) in the Carbonera C7 formation in the CN-3 well has been perforated and put initially on production at a rate of 1,149 bbl/d on pump with a water cut of <0.5%.

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Sep 23

Daily Brief Thematic (Sector/Industry): Japan Weekly | Sankyo the Big Winner; New Activist Stake in Ishihara Chem and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

Japan Weekly | Sankyo the Big Winner; New Activist Stake in Ishihara Chem
China TMT Update-NTES/HK700/3690.HK/FUTU- NetEase Pipeline In Tokyo Game Show/Golden Week/Futu Japan

Japan Weekly | Sankyo the Big Winner; New Activist Stake in Ishihara Chem

The broader Japanese equity index ended the week -2.2% lower; business activity is slowing at the same time global interest rates are likely to remain higher for longer.
Despite the headline negativity, Sankyo put out some bullish 1H guidance, increased divs and executed a large buyback
Nippon Active Value have gone substantial on Ishihara Chemical with a 5% stake

China TMT Update-NTES/HK700/3690.HK/FUTU- NetEase Pipeline In Tokyo Game Show/Golden Week/Futu Japan

NTES US/HK 700: NetEase Reveals More Information About Future Game Pipeline at Tokyo Game Show (+)/(-)
3690.HK/TCOM: Meituan publishes early consumption data for the upcoming “Golden Week” Holiday (+)
Futu Holdings : Futu Japan launched U.S. stock trading service

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Sep 22

Daily Brief Thematic (Sector/Industry): Ohayo Japan: Risk-Off as Rates Hit Decade High; JapanX – Prime Market Slims Down and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

Ohayo Japan: Risk-Off as Rates Hit Decade High; JapanX – Prime Market Slims Down
US Banks – Added $122bn Cash In Past 2 Weeks | Loans up $31bn | CRE Loans Down | Deposits up $113bn
[Blue Lotus Entertainment Sector Update]: What Change Can Mate 60 Bring to Games and Apps
China Property Developers In Distress – Weekly News & Announcements Tracker | 15-21 September 2023
China TMT Update-NIO/LI/XPEV/BEKE/NIO-Xpeng G9/Guangzhou Lift Purchase Restrictions/NIO Chip
[Blue Lotus Hardware Sector Update]: SMIC 7nm and 5nm Sufficient for Huawei Rejuvenation

Ohayo Japan: Risk-Off as Rates Hit Decade High; JapanX – Prime Market Slims Down

OVERSEAS: SPX -1.6% as Treasury yields reached a 16-year high of 4.49%; labour market remains tight
JAPAN: NKY Futures -1.6% v cash, JPY 147.5; Sankyo to buy back 17% of outstanding shares; NTV to buy Studio Ghibli
JAPAN X: More mid-sized companies moving to TSE Standard Index after failing market cap threshold.

US Banks – Added $122bn Cash In Past 2 Weeks | Loans up $31bn | CRE Loans Down | Deposits up $113bn

By Daniel Tabbush

De-Risking is well in place in weekly balance sheet for US banks. Cash rose USD122bn in past 2 weeks, loans rose USD31bn, and deposits rose USD113bn. CRE loans are down.
US banks’ LDR was rising a lot, from 58.6% low in week of 15 December 2021 to 69.3% in the most recent week’s data; they do not want the money.
The increase in large time deposits, which cost more than other deposits, is now 82.8% YoY in the most recent week; this YoY growth was 71.0% just 9 weeks earlier.

[Blue Lotus Entertainment Sector Update]: What Change Can Mate 60 Bring to Games and Apps

Blue Lotus expects Huawei’s smartphone shipment market share to grow 5ppt in 2024, of which 2ppt from Apple and 1.5ppt from Honor;
The impacts are mainly two: (1) Huawei Appstore’s unique revenue share for games and apps, (2) Opportunity to recommend new games and apps through preinstallation;
We see the biggest positive impact on subscription-based video apps and the biggest negative impact on mobile games. We reiterate our Top Pick in iQIYI.

China Property Developers In Distress – Weekly News & Announcements Tracker | 15-21 September 2023

By Robert Ciemniak

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

China TMT Update-NIO/LI/XPEV/BEKE/NIO-Xpeng G9/Guangzhou Lift Purchase Restrictions/NIO Chip

NIO/LI/XPEV:Xpeng G9 facelift price cut exceeds expectations ( -/ -/ +)
Real Estate Industry Update: Guangzhou lift purchase restrictions in outer regions, and property transaction activities are ramping sequentially（+）
NIO：NIO released a self-developed chip, automotive operating system SkyOS , and NIO Phone（+）

[Blue Lotus Hardware Sector Update]: SMIC 7nm and 5nm Sufficient for Huawei Rejuvenation

We estimate that SMICs 7nm yield is >70% with capacity of 19k 7nm wafers per month. We expect SMIC will be able to ship 5nm by 2026 .
We expect Huawei’s wafer demand to reach 18k~ 7nm per month, which would have revenue gain of US$ 550mn~ per quarter to SMIC. We raise SMIC TP to HK$ 27.
We expect Huawei to reach 18% share of the China smartphone market in 2024. We expect Apple and Xiaomi’s China market share to decline by 2ppt and 0.8ppt YoY, respectively.

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Sep 21

Daily Brief Thematic (Sector/Industry): Ohayo Japan: Dots Say Higher for Longer; JapanX: Kishida Lays Out Welcome Mat for Foreign Investors and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

Ohayo Japan: Dots Say Higher for Longer; JapanX: Kishida Lays Out Welcome Mat for Foreign Investors

Ohayo Japan: Dots Say Higher for Longer; JapanX: Kishida Lays Out Welcome Mat for Foreign Investors

OVERSEAS: SPX -0.9% as Fed opted not to raise interest rates. However, the CB now sees rates higher for longer
JAPAN: NKY Futures -0.8% v cash, JPY 148.3/$; Toshiba Tender Offer gets done (finally);
JAPAN X: Tokyo has long-dreamed of becoming a global financial city. Now PM Kishida is inviting foreigners to revitalize the Asset Management Industry

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Sep 20

Daily Brief Thematic (Sector/Industry): Ohayo Japan: Instacart Soars on Debut; JapanX: Pana More than Just EVs and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

Ohayo Japan: Instacart Soars on Debut; JapanX: Pana More than Just EVs
China TMT Update-ZTO/002352.CH/BABA/ PDD/HK 700/NTES/3690.HK-Tencent New Game/Keeta/Parcel Volume
China TMT Update-Nayuki/Luckin/981.HK/1347.HK/ACMR/LI-Food Safety Issue/Increase the Tax-Deductible

Ohayo Japan: Instacart Soars on Debut; JapanX: Pana More than Just EVs

OVERSEAS: SPX -0.2% as Fed began its meeting – expectations are for Fed to hold steady. IPO market on fire as InstaCart closed up 12% on the day
JAPAN: NKY Futures -0.5%, JPY 147.9; Kishida to encourage foreign asset managers to set up shop; Softbank to pocket $5bn from ARM IPO
JAPAN X: Panasonic is more than just an EV play – the 2021 acquisition of Blue Yonder sets the company up to compete in supply chains and automation

China TMT Update-ZTO/002352.CH/BABA/ PDD/HK 700/NTES/3690.HK-Tencent New Game/Keeta/Parcel Volume

ZTO/002352.CH/ BABA/ PDD: Parcel volume data suggests continued consumption rebound (+)
HK 700/NTES: Tencent Announces New Game “Yuan Meng Zhi Xing” (+)/(-)
3690. HK : Keeta expands into Hong Kong Island (-)

China TMT Update-Nayuki/Luckin/981.HK/1347.HK/ACMR/LI-Food Safety Issue/Increase the Tax-Deductible

Nayuki/Luckin: Food safety issue happened on one store of Mixue
981.HK/1347.HK/ACMR: Tax authorities increase the tax-deductible amount for R&D (+)
LI: LI’s latest weekly sales were unaffected by Wenjie (+)

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Sep 19

Daily Brief Thematic (Sector/Industry): Ohayo Japan: Oil Bubbles Higher but Stocks Quiet Ahead of Fed Meeting and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

Ohayo Japan: Oil Bubbles Higher but Stocks Quiet Ahead of Fed Meeting
China Housing – Weekly Data Does Not (Yet) Show Impact Of Policy Easing
China TMT Update-U/ATAT/LI-Unity to Adjust Fees/Pre-Booking Travel on National Day/New Wenjie M7
Inaugural Industry Report Tracks Stocks, Fundamentals, and Economic Drivers
The Highlights – Cannabis News for the Week Ending September 15, 2023
Weekly Sustainable Investing Surveyor Week Ended September 15, 2023

Ohayo Japan: Oil Bubbles Higher but Stocks Quiet Ahead of Fed Meeting

OVERSEAS: US stocks marginally higher; oil rises to almost $95/bbl; market expects Fed to remain on hold this week, while economists expect a hike
JAPAN: Topix earnings expected to rise by 4-7% this year; shortage of qualified independent directors (especially women) becoming an issue; potential job cuts at 7&I
JAPAN X: Global offshore wind projects facing cost pressures but Japan’s latest bids are done. Results by year end; trading companies and heavies likely biggest beneficiaries

China Housing – Weekly Data Does Not (Yet) Show Impact Of Policy Easing

By Robert Ciemniak

The weekly data for new home sales for 18 cities with consistent data to the week ending September 10 does not show pickup signs, despite some media buzz after easing
But we expect the impact to start showing in the next weeks
In the meantime, using weekly metrics as predictors of the direction of the national monthly figures, suggests no real improvement YTD y/y so far for Sep

China TMT Update-U/ATAT/LI-Unity to Adjust Fees/Pre-Booking Travel on National Day/New Wenjie M7

U:Unity to Adjust Previously Established Runtime Fees Due to Developer Pressure (/)
ATAT： Pre-booking travel volume on National Day continue to ramp up（+）
LI: New Wenjie M7 order volume exceeded expectations, continuing to threaten LI (-)

Inaugural Industry Report Tracks Stocks, Fundamentals, and Economic Drivers

Herein we inaugurate the WTR Furniture/Furnishings Weekly. Under “Statistics”, we recap stock price performance for select issues in three sectors: Commercial/Contract Furniture, Residential Manufacturers & Suppliers, and Home Goods Retailers.
Inside, we present data on company operating performance and valuation. Pertinent economic data/charts to furniture/furnishings issues follow.
This front-page column, and additional text, if needed, will be devoted to news tidbits.

The Highlights – Cannabis News for the Week Ending September 15, 2023

Global equities were fairly flat this week, with the MSCI World Index +0.40% and the S&P -0.48%.
The NASDAQ was down 0.39%, while the small-cap Russell 2000 dropped 0.17%.
Rising oil prices boosted value stocks, while Apple’s uninspiring new product introductions weighed on the tech sector.

Weekly Sustainable Investing Surveyor Week Ended September 15, 2023

The WTR Sustainable Index outperformed the broader market, rising 0.8% W/W versus the S&P 500 Index (down 0.2%), the Russell 2000 Index (down 0.2%), and the Nasdaq Index (down 0.5%).
Energy Technology (15.0% of the index) contributed to the index’s outperformance, rising 1.2%, while Industrial Climate and Ag Technology (45.3% of the index) was down 2%, ClimateTech Mining was up 2.6%, and Advanced Transportation Solutions was up 3.7%.
Top 10 Performers: MULN, CMC, FFIE, NKLA, CRGE, WUC, NNOMF, XOS, AZRE, CPTN

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Sep 18

Daily Brief Thematic (Sector/Industry): Turnaround in China Healthcare Anti-Corruption: Impact on Company’s 2023 Results & Upcoming New Reforms and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

Turnaround in China Healthcare Anti-Corruption: Impact on Company’s 2023 Results & Upcoming New Reforms
China TMT Update-1810.HK/AAPL/981.HK/HK700/HK1024/DOYU/BILI/IQ/BABA/VIPS/PDD/3690.HK/YSG/JD-Mate 60
China TMT Update-AAPL/JD/BEKE-Pre-Registrations for IPhone 15 Slightly Lower than IPhone 14

Turnaround in China Healthcare Anti-Corruption: Impact on Company’s 2023 Results & Upcoming New Reforms

By Xinyao (Criss) Wang

The People’s Daily/National Health Commission made “mild” statements about anti-corruption, bringing investors “hope”. However, it depends on the attitude of Central Commission for Discipline Inspection, who is the decision maker.
We break down some industry data to help investors better understand the impact of anti-corruption campaign on China healthcare. It seems inevitable that companies’ Q3 performance would be affected.
Looking ahead, companies’ performance reversal may not be as fast as expected.The anti-corruption campaign could accelerate the next stage of reform. Investors need to be prepared for upcoming new changes.

China TMT Update-1810.HK/AAPL/981.HK/HK700/HK1024/DOYU/BILI/IQ/BABA/VIPS/PDD/3690.HK/YSG/JD-Mate 60

1810.HK/AAPL/981.HK: Local media reports that the Mate 60 series is planned to ship 20mn units (-/-/+)
HK700/HK1024/DOYU/BILI/IQ: Tencent announced its live broadcast rights holder for 2023 Hangzhou Asian Games. (+)/(-)/(-)/(-)/(-)
BABA/VIPS / PDD/ 3690.HK/ YSG/JD: Social retail consumption improved month-on-month (+/+/+/+/+/-)

China TMT Update-AAPL/JD/BEKE-Pre-Registrations for IPhone 15 Slightly Lower than IPhone 14