Daily Brief Japan: Socionext, Nikkei 225, Shift Inc and more

In today’s briefing:

Weekly Deals Digest (16 Jul) – Socionext, Tryt, IMAX, Shougang Resources, Invocare, Musgrave
EQD | Nikkei 225 (NKY) WEEKLY Falling: Support (Short-Term)
High Conviction Shift: Upbeat Quarter, Share Price Up More Than 39% YTD and There’s Further Upside

Weekly Deals Digest (16 Jul) – Socionext, Tryt, IMAX, Shougang Resources, Invocare, Musgrave

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments – Tryt Inc (9164 JP), Alibaba (ADR) (BABA US)‘s Cainiao & Cloud Intelligence Group, J&T Global Express (1936374D CH) IPOs & Socionext (6526 JP)‘s secondary placement.
Event-Driven developments – Chindata Group (CD US), IMAX China Holding (1970 HK), Shougang Fushan Resources (639 HK), Invocare Ltd (IVC AU), Musgrave Minerals (MGV AU).

Nikkei 225 (NKY INDEX) has pulled back from its peak. Direction currently unclear but last week’s positive Close was super weak (+0.1%) , may lead to lower prices this week.
If the index falls this week, a -1 or -2 weeks down is the most common pattern, followed by a rebound. Reversal probability is =75% for -2 weeks down.
Valid support levels for buy-the-dips are between 32067 and 31554. If lower, up to -3 weeks down this pattern is still bullish, from -4 weeks it turns bearish.

Shift reported 3QFY08/2023 results on Friday and the company’s revenues increased 34.2% YoY and OP more than doubled during the quarter. Both revenue and OP beat consensus estimates.
Conclusion of unprofitable projects and expansion into upstream services have helped earnings to expand, and we expect full-year earnings to comfortably beat guidance and consensus estimates.
Shift’s share price moved up by 19% following earnings announcement and has been up more than 39% YTD, and we would recommend holding on as there is further upside.

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