In today’s briefing:
- Good Morning Japan |UBScs – Wedding Vows Sealed; NUGGET: MOL-Diversification Can’t Come Fast Enough
- Globalwafers Q4 2022 Earnings Key Takeaways
- [Consumer Brands Deep Dive]:Structural and Substitution Drive Chinese Consumer
- TRACKING TRAFFIC: Chinese Express / No Signs of a Sharp Recovery in Jan-Feb Data
- Weekly Stock Bullfinder – Week of 3/20
Good Morning Japan |UBScs – Wedding Vows Sealed; NUGGET: MOL-Diversification Can’t Come Fast Enough
- OVERSEAS. Equities Sell-off on Pending Demise of Credit Suisse; Flight to Safety Trade resumes; SNB engineer Shotgun Wedding – deal closed with UBS $3.25 billion. The end of an era.
- JAPAN. On Friday, NKY Futs -2.3% vs Cash as Contagion Fears around Credit Suisse prompted Flight to Safety; With CS Rescue, expect strong open; JP Shippers Container Profits looks shaky
- NUGGET. As Mitsui OSK approaches ex-div, we think the share price will see headwinds given the expected earnings decline on ONE’s earning collapse = (MUCH) lower dividends next year.
Globalwafers Q4 2022 Earnings Key Takeaways
- Globalwafers is bucking the trend with a sequentially flat CY2023 revenue forecast
- Q4 2022 delivered the company’s twelfth successive quarter of sequential revenue growth
- Details of the funding available under the US CHIPS Act for Globalwafers Sherman, Texas greenfield expansion still remain unclear
[Consumer Brands Deep Dive]:Structural and Substitution Drive Chinese Consumer
- Even though we are long-term optimistic on the rise of Chinese consumer brands, we believe short-term optimism is misplaced.
- Two themes: (1) structural changes led by China’s transition to an older and more affluent society, (2) substitution and globalization that can break the ceiling for valuation;
- Our TOP PICKS are Li Auto, Atour, Luckin, FUTU, BEKE and Miniso
TRACKING TRAFFIC: Chinese Express / No Signs of a Sharp Recovery in Jan-Feb Data
- Combined January-February express industry parcel volume was up just 4.6% Y/Y, and ASPs were down -1.8% Y/Y
- Listed express companies’ parcel volume and government-reported online tangible goods sales in the first two months of 2023 also both up a modest ~5% Y/Y
- In a year when one express player hopes to list its shares, it’s unclear who will be willing to concede market share. We expect price competition to intensify in 2023.
Weekly Stock Bullfinder – Week of 3/20
- Volatility continues to show up with the recent banking sector stress which has given market participants fresh concerns over secondary credit exposures and the Treasury/central bankers response to address the issues.
- With the Fed meeting this upcoming week, never before in this interest rate hiking cycle to date has there been more diverse viewpoints coming out over whether a Fed pause, Fed hike, or even a Fed cut should be done in the next meeting.
- Up until this point, the conversations have focused on how much (25bps,50bps, 75bps) the Fed should do at each of its meetings in order to get inflation back down based upon the incoming inflation data.
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