In today’s briefing:
- S&P/ASX200 Ad Hoc Index Rebalance & Update to Potential Changes in September
- StubWorld: SZ International’s Logistics Spin-Offs
- Ventia Services (VNT) Selected to Join ASX 200 – Not A Surprise
- Quiddity Leaderboard ES50 Sep 23: Massive Flows; Might Be Time for LONG Ferrari – SHORT Vonovia
- Quiddity Leaderboard SE600 Sep 23: CD Projekt Could Become an Intra-Review ADD
- EQD | Hang Seng Index (HSI) WEEKLY Deep-But-Brief Pullback
- Investigating HMM’s Latest Bond Conversion Situation for a Shorting Setup
S&P/ASX200 Ad Hoc Index Rebalance & Update to Potential Changes in September
- Ventia (VNT AU) will replace Blackmores Ltd (BKL AU) in the S&P/ASX 200 (AS51 INDEX) at the close on 21 July.
- The ad hoc change will lead to changes in the list of potential adds and deletes at the regular scheduled rebalance in September.
- Weebit Nano Ltd (WBT AU) is now a potential add in September and could see some pre-positioning in the near future.
StubWorld: SZ International’s Logistics Spin-Offs
- Shenzhen International (152 HK) seeks to spin off logistic assets on a PRC exchange; and 51.56%-held Shenzhen Expressway Co H (548 HK) intends to place out A shares.
- Preceding my comments on SZ Int’l/SZ E’Way are the current setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
Ventia Services (VNT) Selected to Join ASX 200 – Not A Surprise
- After the Blackmores Ltd (BKL AU) Scheme Meeting result was announced earlier today, post-close the S&P/ASX team announced Ventia (VNT AU) would replace it on 21 July at the close.
- This is not that surprising. Janaghan Jeyakumar, CFA expected it in June, and it was a super-close second recently for him for the Sep rebalance.
- Given the shareholder structure and flow dynamics, it’s worth taking a closer look.
Quiddity Leaderboard ES50 Sep 23: Massive Flows; Might Be Time for LONG Ferrari – SHORT Vonovia
- The ES50 Index is one of the most highly-tracked indices in mainland Europe and the annual index review takes place in September.
- As ES50 index changes generally involve large cap names, these Rebalance events have historically had significant volume and ADV impact.
- In this insight, we take a look the names leading the race to become ADDs/DELs for the upcoming index review in September 2023.
Quiddity Leaderboard SE600 Sep 23: CD Projekt Could Become an Intra-Review ADD
- In this insight, we take a look at the names leading the race to become ADDs/DELs for the SE600 and EURSTX Indices for the September 2023 Rebalance.
- SimCorp A/S (SIM DC) could trigger an intra-review ADD prior to the September 2023 Rebalance.
- Apart from that, I expect four other changes during the regular rebalance in September 2023. These expected ADDs and DELs are different from those in my last insight.
EQD | Hang Seng Index (HSI) WEEKLY Deep-But-Brief Pullback
- The Hong Kong Hang Seng Index (HSI) last week closed strongly up. This week it’s pulling back, but MRM pattern readings forecast a very short-lived pullback (-1 to -2 weeks).
- The suggested strategy is: let the index play out its pullback (warning: it can be volatile) and then enter LONG trades when the probability is good.
- Suggested support price areas are between 18965 (Q2) and 18732 (Q3) – or this Friday at Close (as long as the close is negative).
Investigating HMM’s Latest Bond Conversion Situation for a Shorting Setup
- Those that the local market is particularly interested in are the 192nd convertible bonds (CB) held by KDB, along with the 193rd bonds with warrants (BW) owned by KOBC.
- These two bonds’ call option exercise date is September 25th. Upon conversion of these bonds, 200M new shares will be issued (41% of SO and a 30% dilution).
- The key is the trade-off between not disrupting the selling process and avoiding any breach of trust. The prevailing local sentiment suggests that KDB and KOBC will choose stock conversion.
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