In today’s briefing:
- TOPIX Rebalance: Flows at the Close
- MSCI May 2022 Index Rebalance: Flows at the Close Today & Performance So Far
- Tsingtao Placement – Ending the Selldowns with the Biggest One so Far
- AGL Drops Demerger Proposal – Back To Square Two
- CCASS: Why Large Moves Continue To Matter
TOPIX Rebalance: Flows at the Close
- The second tranche of the FFW methodology change for the Tokyo Stock Exchange Tokyo Price Index Topix (TPX INDEX) will be implemented at the close of trading today.
- One way flow is ~JPY 745bn and will be spread across ~2170 stocks. The largest inflow will be on NTT (9432 JP) and the largest outflow on Toyota Motor (7203).
- The stocks with the largest inflows have outperformed the stocks with the largest outflows over the last month and the outperformance could continue going into the last tranche in June.
MSCI May 2022 Index Rebalance: Flows at the Close Today & Performance So Far
- For Asia Pacific, there are 48 adds/76 deletes for the Standard Indices and 166 adds/147 deletes for the Small Cap Index that will be implemented at the close today.
- The adds have outperformed the deletes on average over the last few weeks/months. A long adds/short deletes trade performed better for Small Caps as compared to the Standard index.
- There are a lot of stocks that will have same-way flow from other index trackers over the next few weeks and there could be a higher impact on these names.
Tsingtao Placement – Ending the Selldowns with the Biggest One so Far
- Fosun aims to raise around US$527m via selling a 3.5% stake in Tsingtao.
- This is not the first selldown by Fosun, we have covered three prior deals in Dec 2020, Apr 2021 and Dec 2021.
- In this note, we will talk about the deal dynamics and run the deal through our ECM framework.
AGL Drops Demerger Proposal – Back To Square Two
- After 14 months of Strategic Review and preparation for a Demerger of its generation and distribution businesses, the Board has dropped the Demerger Proposal in face of shareholder opposition.
- While it isn’t clear exactly how much opposition there was, Michael Cannon-Brookes held 11+% and General Meetings have garnered 50-75% of investors for a vote which needed 75% approval.
- CEO and Chair have announced their resignations, two other board members will leave, and now the Board will start another strategic review using preparation at hand.
CCASS: Why Large Moves Continue To Matter
- In this latest installment in a series dating back to March 2018, I’ve analysed 5,500 moves over three years inside CCASS, targeting >5% of shares outstanding of individual stocks.
- The data continues to bear out the overall underperformance of stocks that exhibit such moves.
- Additionally, the movement of large blocks of shares may illustrate that the beneficial owner of those shares has pledged them as collateral for a loan.
Before it’s here, it’s on Smartkarma
