EUR 42.78 For Business Accounts Only

Vermilion Int'l Compass: Global Equity Strategy

Downgrading Germany; Technology Leading

We discussed in last week's Int'l Compass (June 19) how bullish price and RS trends on Israel's TA-125 was our tell that global equities were looking past Israel-Iran tensions, and it now appears to be completely in the rear-view mirror. We also discussed how we were expecting short-term support on ACWI-US at $123-$123.50 (6.5-month base support), and ACWI-US bottomed at $123.20 on Monday. As a result, we remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass). We will maintain our bullish intermediate-term view as long as market dynamics remain healthy and the SPX and ACWI-US are above 5700-5785 and $119-$121. $123-$123.50 remains short-term support to watch on ACWI-US; we will maintain our near-term bullish outlook as long as $123 support holds, but a break below it would likely mean a test of $119-$121.

Remain Overweight South Korea, Greece, and the U.S.; Downgrading Germany and Ireland. We are getting more selective within Europe. We already downgraded broad-Europe (EURO STOXX 50) to market weight in our 6/11/25 Int'l Compass, but we are now also downgrading Germany and Ireland to market weight -- be selective. Korea (KOSPI) had been our top country to buy since our May 30 Int'l Compass, and we are overweight as of our June 12 Int'l Compass (though would only buy on pullbacks at this point). Israel's TA-125 also remains leadership... see charts below.
Emerging Markets Remain Bullish, Along With Other Global MSCI Indexes. MSCI Emerging Markets (EEM-US) remains above $46 base support. We have discussed how we are buyers as long as $46 support holds, and that is precisely where EEM bounced on Monday. Korea, Greece, and Taiwan (Technology) remain our top countries to buy. MSCI ACWI (ACWI-US), ACWI ex-U.S. (ACWX-US), EAFE (EFA-US), and ACWI ex-U.S. Small-Caps (local currency) all remain above major base supports as well... see page 2.
Crude Oil No Longer Attractive. We discussed buying WTI crude oil in our June 10 U.S. Macro Vision, and reiterated it in our June 12 Int'l Compass, with targets of $72 and $77 alongside buys within the Energy Sector. $77 held strong as resistance the entire time, and while many of the Energy stocks we highlighted remain attractive, we do not believe the global Energy Sector will be leading any time soon.
Actionable Themes: Technology, Communications, Consumer Discretionary, and Financials. We highlight attractive names within these Sectors... see pages 3-19.