In today’s briefing:
- Ohayo Japan: Tech Lifts Stocks; Wage Hikes Gaining Acceptance in Japan
- Equity Strategy: US Regional Banks: Not Out of the Woods Yet
- Furniture/Furnishings Weekly – WTR Furniture/Furnishings Conference Approaching
- Industry Report – Chemicals & Materials Technology
- The Highlights – Cannabis News for the Week Ending January 5, 2024
Ohayo Japan: Tech Lifts Stocks; Wage Hikes Gaining Acceptance in Japan
- Overseas: US Tech stocks lead charge higher. Nvidia +6.4% to all-time high; Semicon ETF +3.5%; Boeing -8%; WTI Crude -4% on Saudi price cuts
- Today: NKY Futures point to strong open; JPY stable at 144/$; Honda considers $14b plant in Canada; Uniqlo Japan December sales -15%
- Japan: Wage hikes, at least for larger companies, could be in the +5-6% range this year. Good news for BoJ looking to exit ultra lose policy
Equity Strategy: US Regional Banks: Not Out of the Woods Yet
- Large regional banks in the US have been troubled in 2023 by the proposed “Basel III Endgame” regulations, asset quality issues and earning pressure in terms of the high COF
- We believe these factors have made the sector more cyclical and vulnerable to even a mild recession scenario in 2024-25
- We are particularly weary of names at regulatory risk (like USB), and those with higher exposures to CRE
Furniture/Furnishings Weekly – WTR Furniture/Furnishings Conference Approaching
Furniture & furnishings equity issues slumped in the final two weeks of 2023 and into the first week of 2024. The group had a positive year.
The commercial/contract furniture stocks gained 46%, beating all major broad market indices.
Steelcase led the sector with a ~91% gain for the year.
Industry Report – Chemicals & Materials Technology
- WTR-CMI in 2023. With the majority of stocks in our index finishing the year in positive territory, the WTR-CMI Index managed to keep pace with the Russell 2000, appreciating 15%.
- However, both indexes fell well short of the 24% growth of the S&P 500 in 2023, with the WTR- CMI Index dragged down by four companies that lost more than 50% in value during the year.
- Weak demand and destocking. Looking back at 2023, several themes are emerging as we head into 2024, such as declining commodity prices and weakening end-market demand, with Y/Y volume comps affected by destocking across several end-markets since mid-year, as supply chain constraints, which characterized 2022, are resolved and companies go back to just-in-time inventory management.
The Highlights – Cannabis News for the Week Ending January 5, 2024
- It was a strong start of the year for cannabis stocks, with the US cannabis MSOS ETF gaining 13.12% and the global YOLO ETF increasing 9.11%.
- US cannabis continues to outperform Canadian and other global names due to the positive sentiment driven by the potential for the DEA to agree with the HHS’s Schedule III recommendation.
- This would eradicate 280E, the onerous tax code that applies to plant-touching US operators.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
