In today’s briefing:
- FTSE All-World/All-Cap Index Rebalance: Changes, Switches, Hits & Misses
- Hang Seng Tech Rebalance – No Name Changes But Lots of Flow
- Will This De-SPAC Be The Next Peloton?
- China Internet Weekly (22Aug22): E-Commerce, Logistics, Online Game, Food Delivery
- RC Ventures Sold Its Entire Stake In Bed, Bath & Beyond. Is GameStop Next?
FTSE All-World/All-Cap Index Rebalance: Changes, Switches, Hits & Misses
- FTSE announced the results of the September SAIR for the FTSE All-World/All-Cap indices on Friday. There are 243 changes (adds, deletes, migrations across AW/AC) across Asia-Pac.
- The largest inflows will go to PSMC (6770 TT), Sumber Alfaria Trijaya (AMRT IJ), Daqo New Energy (DQ US) and Tianqi Lithium (002466 CH).
- FTSE will switch index membership from the US ADRs to the HK listings for New Oriental Education & Technology Group (9901 HK) and XPeng (9868 HK).
Hang Seng Tech Rebalance – No Name Changes But Lots of Flow
- The Hang Seng Index Team announced the index review for the Hang Seng Tech Index Friday after the close. There were no additions or deletions.
- However, there is a 4.9% one-way turnover on reasonably heavy FAF and capping changes. Sensetime sees a huge FAF increase. Tencent, Meituan, and Kuaishou get re-capped higher. Xiaomi lower.
- There is a fair bit of flow, but the obvious big name – SenseTime Group (20 HK) – has potential overhang. Watch Haier Smart Home Co Ltd (6690 HK).
Will This De-SPAC Be The Next Peloton?
- Pandemic darling Peloton saw a meteoric rise and fall over the past two years.
- The company initially benefited from soaring demand, but overestimated demand and eventually leading to a fire sale and massive layoffs.
- German sports e-commerce retailer Signa Sports United, which went public through a SPAC deal last year, could face a similar fate in the coming months.
China Internet Weekly (22Aug22): E-Commerce, Logistics, Online Game, Food Delivery
- Logistics companies’ revenue grew by over 10%, which reflects the recovery of e-commerce.
- The market size of Chinese online game continued to shrink in July.
- Alibaba’s Ele.me sets up a mini-program on TikTok to fight Meituan.
RC Ventures Sold Its Entire Stake In Bed, Bath & Beyond. Is GameStop Next?
- GameStop (GME US) shares have materially outperformed the Nasdaq and S&P 500. GameStop shares fell ~2% YTD vs. Nasdaq (~-19%) and S&P 500 (~-11%).
- RC Ventures, controlled by GameStop Chairman Mr. Ryan Cohen, holds a ~12% stake in the struggling video game retailer. The company announced a 4-for-1 stock split in July.
- GameStop reported a record net loss of $158M and burned through ~$311M in cash in 1QFY22. We continue to believe the stock is massively overvalued and see downside potential.
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