In today’s briefing:
- China’s Semi Mega Push Is Inevitable. But Is It Investable? Part 1.
- Ohayo Japan| SPX Gains Despite Weak Factory PMI; NUGGET: Japan’s GX Promotion Law – Opportunity !
- [Blue Lotus Macro]: Economic Stimulus Shouldn’t Be Pain Killers
- China TMT Update Jul.4-2252HK/1801HK/LEGN/LKNCY:14th Five-Year Plan for Medical Equipment Allocation
China’s Semi Mega Push Is Inevitable. But Is It Investable? Part 1.
- The growth of China’s semiconductor industry is inevitable and ever increasing sanctions on advanced semi supply chain components are adding fuel their self-sufficiency aspirations
- Most Chinese semi stocks P/E ratios are sky high & volatile to boot. Many US semi stocks have peaked as far as their exposure to China growth is concerned.
- One sub-segment of the WFE sector may provide China semi growth exposure at reasonable valuation with relatively low risk.
Ohayo Japan| SPX Gains Despite Weak Factory PMI; NUGGET: Japan’s GX Promotion Law – Opportunity !
- OVERSEAS. SPX eakes out gains despite weak ISM Manufacutring in light trading ahead of July 4th Independence Day Holiday; TESLA +6.9% on big 2Q delivery numbers
- JAPAN. NKY Futs -0.4% vs Cash; JPYUSD 144.7; Strong BOJ Tankan print drives NKY to new highs; JP land prices continue to rise; Support for JP foundry goals from IBM
- NUGGET. Japan’s passing of the GX Promotion Law enables the issuance of ¥20 trillion in bonds and promotes ¥150 trillion of decarbonization investment over the next decade. Investment opportunities abound!
[Blue Lotus Macro]: Economic Stimulus Shouldn’t Be Pain Killers
- A collapse of real estate speculation destroyed the balance sheets of Chinese households, leading to downward spiral in consumptions. A tremendous stimulus package can reflate the economy,
- But it doesn’t solve the structural problems; Unlike semiconductor and biotech, inputs to renewable energy are many and supply chains are long. To stay ahead, Chinese companies must keep themselves
- Cost competitive, which means they can neither realize profits nor retaliate US containments. But their equities offer the long-term hope to replace real estate as nest eggs of Chinese retirees.
China TMT Update Jul.4-2252HK/1801HK/LEGN/LKNCY:14th Five-Year Plan for Medical Equipment Allocation
- 2252HK: NHC issued the “14th Five-Year Plan for Large-Scale Medical Equipment Allocation” , the planned quota of laparoscopic robots is slightly lower than our estimated (-)
- 1801HK/LEGN:Innovent/ISAO co-developed CAR-T received approval in China ahead of Legend’s CARVIKTI, might try to squeeze in NDRL list this year (+)
- LKNCY: Luckin Coffee reported 50mn monthly transacting customers in June(/)
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