Thematic (Sector/Industry)

• Stocks advanced for a second straight session Wednesday, with the S&P 500 and Dow Jones Industrial Average closing at record highs
• Japan’s Prime Minister Ishiba dissolved parliament for an October 27 snap election, seeking mandate amid low public support due to a fundraising scandal
• Canadian retailer Couche-Tard has increased its takeover offer for Seven & i Holdings to $47 billion, up from $38.5 billion

• Risk on sentiment takes hold ahead of key CPI print tomorrow; yen weakness will drive the NKY higher.
• Big gains for Japanese department store duty-free sales over the Chinese Golden week holiday bodes well for the likes of Isetan Mitsukoshi.
• Cat 5 Hurricane Milton making landfall should put further pressure on the JP non-life/P&C plays Sompo, MS&AD and Tokio Marine.

• There is a sharp and accelerating rise in deposits with Hong Kong’s banks, likely from Mainland China in part
• There is no offsetting lending volume, where loan growth remains still negative, not a positive combination for net interest income
• The LDR for Hong Kong’s banks is fast approaching the distressed levels seen during the Global Financial Crisis (GFC)

• At least 10% deposits will invest in Chinese stocks in the future.Together with US$2 trillion capital that stranded overseas will flow back, 3,500 Shanghai Composite Index is just the beginning.
• After the monetary policy, we expect to have accompanying fiscal stimulus policies introduced. However, short-term challenge lies in the uncertainty of macro environment that potential depression/Middle East war might bring.
• Investors can consider taking profits in time for the surge in Chinese stocks,and then prepare to position themselves for the inflation trade opportunities that the dollar depreciation will bring later.

• We analyzed the historical data of wars and its impact on financial markets.
• Nifty 50’s performance shows short-term fluctuations post-conflict but generally stabilizes, highlighting market resilience and investor sentiment shifts during uncertainty.
• Diversification, Long term investment perspective and Govt Bonds help in these kind of situation to make portfolio stable.

• Last month, the DOE published a paper about the commercial liftoff of Advanced Nuclear. 
• Larry Ellison mentioned that SMRs (Small modular reactors) will power data centers in the future, and Microsoft will unshutter 3 Mile Island for one last puff of a half-smoked cigarette. Just a few years ago, it was closed for economic reasons.
• This is going to be the first in a series about Nuclear Power. Today, I’ll talk about Nuclear Reactors and the basics.

• NVDA lifts markets on comments from Hon Hai Chairman that demand for Blackwell was ‘crazy’.
• Oil related names in JP will follow US lower on the drop in oil, despite Hurricane Milton having the potential to disrupt production.
• HK futures finding off the lows overnight should point to upside for related China names in Japan to start; Gamers to be sold heavily after PIF sale.

• U.S. stocks rebounded Tuesday as oil prices retreated, easing Middle East tensions concerns
• Tech stocks led gains, with Nvidia and Broadcom up 4% and 3% respectively
• The Tokyo Stock Exchange’s CEO emphasizes the growing importance of shareholder dialogue in Japan’s corporate governance reform.

• TCOM US: Overseas Travel for National Holiday Grow Faster than Domestic Travel, Potentially Signaling the End of Consumption Downgrading (+)
• PDD US: PDD announces another support plan for “quality merchants” (/)
• BABA US/JD US/002352 CH: E-commerce players intensify logistics competition in Hong Kong (////-)

• 300750 CH/1211 HK:A fire broke out at CATL’s Fujian factory, negatively affecting its safety image (-)
• 1211 HK:BYD recalls close to 100,000 vehicles, mainly produced in 2022-23 (/)
• 1519 HK/ZTO US: Parcel volume collection +40% yoy in prior week (+)

• The South African All Property Index (J803) continued its strong 2024 run in September, rising by 5.16% for the month, taking the index’s 2024 Total Return to 29.73%.
• The third quarter saw a 19.14% total return, and all three months delivered positive returns. On a rolling one-year basis, the J803’s Total Return has been very robust at 46.98%. 
• The sector shrugged off concerns that it may start to run out of steam, and as several companies posted better than expected annual results and pre-close updates during the month.

• Two decades ago, graphene hit the headlines after two professors at University of Manchester managed to isolate a slice of the just one-atom thick substance using scotch tape
• Marketed as being 200 times stronger than steel, graphene rapidly gained “wonder material” status and spawned a tidal wave of graphene based products, companies and investment opportunities
• At least four “Graphene” companies listed on London’s AIM, collectively once worth north of $1 billion, have either delisted or been reduced to penny stock status. 

• Server related names higher after some big sales numbers and new product launches from SMCI should be a positive for Nidec
• Watch for P&C weakness in Japan following losses for peers overnight as Hurricane Milton intensifies as it approaches the Florida coast line
• Oil back above $80 will continue to push related names higher; possible refiner pair with 4 days of TPX FFW selling for recent outperformer Idemitsu

• U.S. stocks declined on Monday as Treasury yields hit multi-month highs and oil prices surged
• Essilor Luxottica, the global eyewear giant behind Ray-Ban, has acquired a 5.10% stake in Nikon
• Tokyo Metro announced IPO preliminary share pricing of 1,100-1,200 yen, with final pricing to be determined through book-building from July 8-11

• Weekly HFD for large US banks are turning positive in several areas, making the mosaic even stronger than if just as single series were improving
• Loan growth for the largest US banks is now positive even if low, but moving from a negative rate of growth, the trajectory is a steady improvement
• Loan loss reserves growth is lowering, suggesting bettering LGD and PD while large time deposit growth is down substantially, improving liquidity risk (which can impact credit)

• We review last week’s biopharma news for meaningful clinical data, regulatory updates, research innovation, and M&A.
• Last week, HIMS and unapproved GLP-1 sellers (LFMD) were put on notice by the FDA.
• KZR’s study was stopped and placed on clinical hold, but the stock rose.

• A mixed week for furniture and furnishings stocks as technology stocks once again drive the market.
• The Water Tower Research Commercial/Contract Furniture Index (-1.7%) and Home Goods Retailers Index (-3.9%) were both down for the week, while the Residential Manufacturers & Suppliers Index (+1.2%) was up.
• The Mass Retailers Index was basically flat (+0.1%), while the three major indexes were all down modestly, with the S&P 500 and DJ30 both down (-0.2%) and the R2K down (-0.8%).

• China announced significant economic measures to stimulate its markets and address ongoing challenges
• The S&P 500 started Q4 on a volatile note with concerns around the U.S. labor market, Middle East tensions, East Coast port strikes, and the approaching U.S. presidential election
• This week, the Nikkei experienced significant volatility, closing 1,193 points lower, marking its first weekly decline in four weeks

• US stocks rallied Friday, with the S&P 500 gaining 0.9% to 5,751 and the Dow adding 300+ points to set a new record
• Japanese companies’ capital investments in China dropped 16% year-on-year in Q2 2023, falling below European investments for the second consecutive quarter
• Yaskawa Electric reported its first quarterly order growth in two years, with a 1% increase to ¥126.3 billion.

• Japan to follow US higher on the much better-than-expected jobs report and the yen back to 148.9
• Exporters including the Autos with high US exposures as well as Inbound related laggards such as Isetan Mitsukoshi and Shiseido/Kose should see sentiment improve
• The strong US data should also help the JP Shippers rebound after dropping -8.2% on Fri on the end of the US port workers strike

• The Global Emerging Markets Weekly summarises the key news and related developments impacting the largest countries and constituents of the Global Emerging Markets equity indices.
• Macro data points: Chinese PMI data, South Korean trade and inflation data.
• Companies mentioned:NIO (9866 HK), ByteDance (1439927D CH), Bharti Airtel (BHARTI IN), Samsung Electronics (005930 KS)

• China’s NMPA aims to redouble efforts to facilitate research and market registration of homegrown innovative drugs, while speeding up the introduction of novel foreign drugs to the domestic market.
• Since the BoJ interest rate hike in July, the Yen appreciated ~5% to ¥142.74. Considerable amount of appreciation may be dilutive on the overall performance of export-oriented healthcare industry.
• Sigma Healthcare (SIG AU) has offered remedial measure to alleviate preliminary anti-competition concerns raised by ACCC in relation to its proposed merger with CWG.

• HK and China RE stocks on average rallied 20% and 174% respectively, since the US started rate cut and China’s huge economic stimulus
• Based on trading flows, positioning, and valuation, it is not too late to chase the rally.  The timing, the language and the form of Chinese policy announcements are un-precedented
• Don’t fight against Beijing!  We analyze upcoming catalysts and risks.  Next Tuesday is a key time to watch due to potential policy window and trading resumption of Chinese equities. 

• This report is almost entirely based on datamined from technical publications related to patents and innovations in the area of Odontology.
• The industry will see significant consolidation as mid-sized and smaller players with inspired innovations are be bought out as the industry seeks more cost-efficient distribution channels
• Among the listed companies 3M Co (MMM US) , Dentsply International (XRAY US) , Align Technology (ALGN US) , Envista Holdings (NVST US)  & Straumann Holding (STMN SW) stand out. 

• AUCTUS PUBLICATIONS ________________________________________ ADX Energy (ADX AU)C; Target price A$0.75 per share: Welchau is about oil rather than gas: perhaps smaller but higher value boe – Welchau is now interpreted as a light oil rather than a gas condensate discovery based on detailed analysis of samples recovered from the well and other well data.
• While this means that the energy equivalent hydrocarbon volumes may be smaller than the original pre-drill estimates, onshore oil can be more valuable than gas to a small company due to the ability to produce and progressively develop a field without having to first prove up sufficient reserves to underwrite a pipeline and secure a gas contract.
• Welchau is estimated to hold 90-95% oil and the production from Welchau-1 could be trucked to a point of sale or to ADX’s existing 3,000 bbl/d Anshof facility for processing when stable flows can be established.

• This note is a weekly (select weeks on SK) 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 the sources

• With the HSI surging 21.2% since 24 Sep and many stocks have even doubled, the strategy in the HK and China markets will move to chase the laggards.
• Among the underperforming HSI constituents, China Resources Power (836 HK) and China Mobile (941 HK) are the better candidates to pick up performance. 
• For HSCEI, Zijin Mining Group Co Ltd H (2899 HK) and China Shenhua Energy Co H (1088 HK) have lagged but their stories are interesting and should regain momentum.

• U.S. stocks edged lower Thursday as investors remained cautious ahead of Friday’s crucial jobs report, with the S&P 500 dropping 0.2%
• Bank of Japan board member Noguchi suggests further interest rate hikes should be slow and cautious to protect the economy
• UBE announced its largest-ever acquisition, buying LANXESS’s urethane business for €460 million (¥73.6 billion).

• Something remarkable has happened in the department store sector. A year ago, both big city stores and those in the regions were all still well behind sales levels in 2010. 
• But stores in the largest 10 cities exceeded 2010 sales levels by 2% last year. Emphasising the yawning gap, regional stores extended their losses with sales down 42% on 2010.
• The elite have also suddenly started making money. A lot of it. We now have a (very profitable) luxury retail sector and a (poor returning) middle-market general merchandise store sector.

• The packaging sector is making a comeback as key material spreads have been rising  which is being reflected in Q1FY25 results of the companies.
• What makes this sector more interesting is certain promoters of these companies are buying share of the company from the open market along with fund infusion by some big investors
• The biggest risk remains for the sector is pricing pressure and demand-supply mismatch but it seems bottom is being made for the sector

• Big move higher for oil set to spike the JP oil major Inpex although the refiners have large outstanding short interests and may squeeze
• The higher oil price is negative for Japan’s utilities which have yet to restart reactors and are dependent on oil/gas imports to fuel their thermal generation
• Details are limited on a potential Seven Bank stake sale by 7&I, but there should be room for upside as shorts continue to cover

• Announcement of a free resource for money miners in the lithium space
• Discussion about upcoming quarterly season and potential moves by Gina in Lion Town
• Consideration of cash burns, balance sheet pressure, and potential takeover scenarios in the mining industry

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

• U.S. stocks edged slightly higher Wednesday despite escalating Middle East tensions between Israel and Iran
• UNIQLO reported a 22.1% increase in domestic same-store sales for September, marking six months of consecutive growth
• Toyota Motor is delaying its electric vehicle production in North America from 2025 to early 2026, citing design adjustments and slowing EV sales in the U.S. market

• Further PM Ishiba flip-flopping on his previously hawkish rates policy, set to catch markets wrong footed today.
• Homebuilders may face a bigger fallout than expected from hurricane Helene given the potential to squeeze margins as materials and workers are prioritized for emergency efforts.
• Exporters including autos, R/E and tourism related names should see renewed interest on the weak yen.

• WTR-CMI last week. Driven by the recovery in lithium stocks, our WTR-CMI index of 30 specialty chemicals and materials technology stocks rose 1.7% for the week, handily outperforming mostly flattish performance of large cap tech-heavy S&P 500 as well as the broader Russell 2000 indices.
• YTD the WTR-CMI continues to outperform the Russell 2000 (13.6% vs. 9.8%) and on YoY basis our index nearly kept up with S&P 500’s strong 33.8% rise by appreciating 31.1% compared to Russell 2000’s 24.6% improvement.
• Hurricane season kicks into high gear. While the impact of hurricane Helena are still being assessed, Francine’s impact on oil and gas production and barge traffic are already being felt in the markets, with gulf coast oil production down nearly 40% and natural gas production down nearly 50%, with barge fleets staying away from the region until weather settles, which now looks to be delayed due to Helena’s destructive path.

• US stocks ended sharply lower on Tuesday amid heightened geopolitical tensions as Iran launched over 100 ballistic missiles at Israel
• Nike shares fell 2% after hours despite Q1 earnings beating expectations at $0.70 per share vs. $0.52 estimated.
• Mizuho is negotiating to acquire a stake in Rakuten Group’s credit card unit, aiming to expand its fintech services

• Profit taking hit tech/semi’s as tensions rapidly escalate in the Middle East, causing defense and oil related names to move higher
• NEC remains overlooked as a defence play in Japan despite the MoD’s growing for budget for electronic warfare and satellite defence capabilities
• Renewables in the US are leading the way YTD, although Japan is far behind the curve despite PM Ishiba being a pro wind/solar and hawkish towards nuclear.

• Budgets are always important for investors.
• The imminent Budget, at the end of October, will be doubly so, because it is the first from the new Labour government, and it has already signalled the need to fill an alleged £22bn black hole, while ruling out changes to more than half the tax base.
• That implies a lot of the pain will be felt by investors.

• The wait is finally over.  The Fed delivered a 50bps rate cut in September meeting, kick- starting a new rate cut cycle
• The rate cut is an absolute game changer for Hong Kong real estate.  Physical market will recover with lower mortgage rate and companies will enjoy lower borrow rate
• With the macro backdrop in US and China, Hong Kong is well positioned for as strong re-rating with mega catalysts ahead – Buy HK real estate, especially SHKP and NWD

• China’s SSE Composite Index surged 18% due to government stimulus measures, focusing on real estate and financial sector revival.
• Stimulus boosts global commodity demand, while India’s domestic market remains resilient despite minor FPI rebalancing towards China.
• China’s recovery doesn’t significantly impact India’s growth, driven by strong domestic inflows and stable market conditions.

• U.S. stocks closed September and the third quarter with fresh records despite Federal Reserve Chair Jerome Powell’s  signaling no rush for further rate cuts
• Shigeru Ishiba, newly elected president of Japan’s ruling LDP, announced plans to dissolve the lower house and hold a general election on October 27.
• SoftBank’s Vision Fund will reportedly invest $500 million in OpenAI’s $6.5 billion funding round, valuing the AI startup at $150 billion

• Plenty of Ishiba trades to pickup this morning after yesterday’s panic.
• Defence related saw some initial profit taking after pricing in some gains, but KHI and NEC remain attractive on the long side.
• Selective Inbound tourism, domestic revitalization, and China plays should snap back fairly quickly with Ishiba unlikely to upset voters ahead of elections.

• Larsen & Toubro (L&T) plans to generate INR 40,000 crore in pre-sales revenue through aggressive land acquisition and portfolio expansion.
• NLC India aims to reach a mining capacity of 1 MTPA for critical minerals by FY30
• Reliance’s Viacom 18-Disney Merger Approved, Creating India’s Largest Media Empire

• Furniture and Furnishing stocks performed well against the major market indices, where the relative calm at the level of the overall indices belied the leadership churn and rotation back into tech following the recent Fed rate cuts (1).
• The Water Tower Research Commercial/Contract Furniture index (+0.5%), Residential Manufacturers & Suppliers (+4.5%), and Home Goods Retailers index (+1.0%) we up all up more than the DJ30 and SP50 (both +0.3%) while the Mass Retailers index (-1.5%) and R2K (-0.2%) were both down.
• In a market where technology stocks are again leading and big caps are outperforming smaller caps, the relative outperformance of the Water Tower Research indices is notable. 

• Since the BoJ interest rate hike in July, the Yen appreciated ~5% to ¥142.74. Considerable amount of appreciation may be dilutive on the overall performance of export-oriented industry.
• Top healthcare players have assumed a higher exchange rate (than the current prevailing rate) for their respective full-year FY25 guidance.
• With benefit of favorable foreign exchange gradually fading and potentially diminishing guidance, investors need to be selective in picking healthcare bets in Japan.

• Higher Exchanges is a weekly cannabis-investing conversation hosted by WTR’s Head of Cannabis Jesse Redmond and Morgan Paxhia, co-founder of Poseidon.
• Those interested can listen to the show on Apple Podcasts, Spotify, or X Spaces.
• This week’s show began with a discussion about Senator Ron Wyden’s Cannabinoid Safety and Regulation Act, which proposes more regulation for the hemp industry. 

• We review last week’s biopharma news for meaningful clinical data, regulatory updates, research innovation, and M&A.
• Last week, BMY received landmark antipsychotic approval, while BHVN finally scored a win in rare genetic SCA.
• AMGN had approvable data in atopic dermatitis and gMG, but not enough to dethrone REGN and ARGX.