In this briefing:
- Japan Drugstores Set to Expand Further
- ECB, BoJ Suck Wind – EA Threatened with Japanisation
- Foldable Smartphones to Debut in 2019; Will It Aid an Industry Turnaround?
- Komatsu, HCM and CAT Tactical Recovery Targets and Macro Pivot Support
- BoJ Steps in as ECB Exits
1. Japan Drugstores Set to Expand Further
The drugstore sector has been the fastest growing retail sector after e-commerce in the last decade, boosted by the popularity of Japanese toiletry and cosmetics brands among tourists and the push for market share by leading players.
Drugstores already account for 40% of cosmetics sales and their share of other key categories is growing, even in food, with some chains already selling enough food to qualify as top 20 supermarkets (in 2017, 26.2% of drugstore sales came from food).
Future profit growth will be determined by prescription services, food and M&A, with all of the leading firms racing to build capacity.
2. ECB, BoJ Suck Wind – EA Threatened with Japanisation
By Charles Dumas, Chief Economist
- Monetary stimulus fails export-dependent savings glut countries
- Japan now accepts huge budget deficits and negative interest rates
- EA needs broad structural reform to avoid Japan’s deep malaise
3. Foldable Smartphones to Debut in 2019; Will It Aid an Industry Turnaround?
Plans regarding Samsung and Huawei’s foldable smartphones are out. The companies, which happen to be two of the largest contenders in the smartphone landscape are expected to unveil their foldable smartphone prototypes this month. In 4Q2018, Samsung, coming in first place, held a market share of 18.7% while Huawei, in third place, held a market share of 16.1%. Both companies are following different strategies when it comes to their foldable phone models.
The concept of foldable phones revolves around devices that can be folded into the size of a smartphone or opened up in to the size of a tablet. Huawei is said to be planning to introduce their foldable smartphone with 5G compatibility while Samsung is planning to release their foldable model with 4G compatibility. The market leader aims to leverage the expertise it has gained on its display technologies in its foldable smartphones.
4. Komatsu, HCM and CAT Tactical Recovery Targets and Macro Pivot Support
We thought a technical view on these counters would help clarify where tactical rally targets come into play as well as more important macro support levels where a basing process is expected to begin.
Key resistance points can be used as short zones with key pivots stops and limit levels that reign in risk.
All three stocks display varying degrees of a macro descending corrective wedge formations that have yet to fully mature.
CAT stands out as the more buoyant of the group and faces its own set of upside pivot resistance points with solid macro support to work with on weakness.
We wanted to fold in a technical view with Mio Kato, CFA and his insight Komatsu, HCM, CAT: The Stock Punishment Does Not Match the Outlook Deterioration Crime . This group may be ahead of the earnings curve and why we may see more gas in a corrective bounce cycle (CB easy policy and the hunt for value may be part of the rally) before more pressure points are hit to re test macro support targets.
5. BoJ Steps in as ECB Exits
By Shweta Singh, Managing Director Global Macro
- Global central banks turning dovish
- But BoJ maybe the only DM central bank ‘properly’ injecting liquidity this year
- European debt – including Italian BTPs – could benefit the most
Get Straight to the Source on Smartkarma
Smartkarma supports the world’s leading investors with high-quality, timely, and actionable Insights. Subscribe now for unlimited access, or request a demo below.
