Report
Dave Nicoski ...
  • Ross LaDuke
EUR 46.40 For Business Accounts Only

Vermilion Int'l Compass: Global Equity Strategy

Support Levels Holding; Bullish Outlook Intact

Broad global indexes (MSCI ACWI, ACWI ex-US, EAFE, and EM) were able to shrug off news on Monday of a more contagious Covid variant that popped-up in the UK. The fact that these global indexes as well as major averages in the UK (FTSE 100), Europe (STOXX 50), and Japan (TOPIX & TOPIX Small) all held above important base support levels tells us all we need to know -- that the market does not see it as a problem at this point in time. Additionally, Covid fears have done nothing to derail ongoing positive market dynamics. As long as support levels hold and market dynamics remain positive, our outlook remains bullish and we continue to view any weakness as a buying opportunity.

· Broad Index Overview. Broad global indexes (MSCI ACWI, ACWI ex-US, EAFE, and EM) and major indexes in the UK (FTSE 100), Europe (STOXX 50), and Japan (TOPIX & TOPIX Small) all held above important short-term support. As long as these short-term support levels continue to hold, there is little risk of a more significant pullback... see chart below and page 2.

· Market Dynamics Remain Positive. The US dollar remains in a downtrend. The MSCI ACWI Consumer Discretionary vs. Staples ratio remains in an uptrend. Small-caps are outperforming relative to large-caps (ACWI ex-US Small vs. Large-Caps). High yield spreads in the US and Europe continue to narrow. Commodities (Bloomberg Commodity Index, WTI & Brent crude oil, and copper) are bullish. All of the above suggest a risk-on environment that is bullish for equities; we would need to start seeing reversals in the aforementioned trends in order to turn cautious.

· Actionable Themes: Services, Technology, Manufacturing, and Materials. The global Technology, Manufacturing, and Materials Sectors remain leadership -- add exposure/remain overweight. The Services Sector has plenty of attractive opportunities and in many ways it is very similar to Technology -- add exposure... see pages 3-16.
Underlyings
21Vianet Group Inc. Sponsored ADR Class A

21Vianet Group is carrier-neutral internet data center services provider in China. Co. hosts its customers' servers and networking equipment and provide interconnectivity to improve the performance, availability and security of their internet infrastructure. Co. also provides managed network services to enable customers to deliver data across the internet in a faster and more reliable manner through its extensive data transmission network and its proprietary smart routing technology. Furthermore, Co. provides complementary value-added services, such as CDN services, VPN services and last-mile wired broadband services to improve the security, speed and quality of data transmission in China.

Accton Technology Corp.

Accton Technology is engaged in the research, development, manufacture and sale of computer network system, customer premises equipment, optoelectronic communication subsystem, application-specific integrated circuit (ASIC), uninterruptible power supply system, power supply and spare parts, integrated services digital network point of sale system and inverse multiplexer, cellular mobile communication network packet data network, wireless local area network (WLAN), wireless local loop (WLL) system; and import and export trading. Through its subsidiaries, Co. is also engaged in investment holding; and research, development and manufacture of bluetooth related products.

Africa Opportunity Fund

ASML Holding N.V.

Avino Silver & Gold Mines

Avino Silver & Gold Mines is engaged in the acquisition, exploration, production and development of silver, gold, copper and other mineral properties in Mexico and Canada.

BE Semiconductor Industries N.V.

BE Semiconductor Industries N.V. (Besi) is a holding company. The Company is engaged in the development, manufacturing, marketing, sales and service of semiconductor assembly equipment for the global semiconductor and electronics industries. It operates through three segments: Die Attach, Packaging and Plating. It develops assembly processes and equipment for leadframe, substrate and wafer level packaging applications in a range of end user markets, including electronics, computer, automotive, industrial and solar energy. The Company offers products, such as Die attach equipment, which include single chip, multi-chip, multi module, flip chip, thermo-compression bonding (TCB) and enhanced wafer level ball grid array (eWLB) die bonding systems, and die sorting systems; Packaging equipment, which include wafer level molding and singulation systems, and Plating equipment, which include metal plating systems and related process chemicals.

Canadian Solar Inc.

Capital Senior Living Corporation

Capital Senior Living is an operator of senior housing communities. The company provides senior living services, including independent living services, which are provided to seniors who do not yet need assistance, but who prefer the physical and psychological comfort of a residential community that provides health care and other services; assisted living services, which include personal care services, 24-hour staffing, support services, and supplemental services; and memory care services, which maintain programs and living accomodations for residents with certain forms of dementia. The company makes home care services available to clients at its senior housing communities through third-party providers.

Lightspeed POS

LONGi Green Energy Technology Co Ltd Class A

LONGi Green Energy Technology Co., Ltd., formerly Xi'an LONGi Silicon Materials Corp., is a China-based company mainly engaged in the research and development, manufacture and distribution of mono crystalline ingots, mono crystalline wafers, batteries and assemblies. The Company's products consist of mono crystalline ingots, wafers, poly crystal silicon materials, polyethylene glycol, silicon carbide powder, solar modules and others. The Company is also engaged in the investment development, construction and operation of photovoltaic ground power plants and distributed power plants. It conducts its businesses within domestic and overseas markets.

Renesas Electronics Corporation

Renesas Electronics is a semiconductor solution provider. Co.'s solutions include electronic products and systems for communications, computing and peripherals, consumer electronics, as well as automotive and industrial sectors. Along with its subsidiaries and associated company, Co. operates in four business segments: automotive, industrial, broad-based and other semiconductors. Co.'s principal products are microcontrollers, microprocessors, smart analogs, secure MCUs (Microcontroller Units), embedded systems platform, software, tools, IPDs (Intelligent Power Devices), power MOSFET (Metal-Oxide-Semiconductor Field-Effect Transistors), analog and mixed-signal ICs, and transistors.

SHOPIFY INC.

Shopify provides a cloud-based commerce platform designed for small and medium-sized businesses. Merchants use its software to run their business across all of their sales channels, including web, tablet and mobile storefronts, social media storefronts, and brick-and-mortar and pop-up shops. Co. provides a platform for merchants to create an omni-channel experience that helps showcase the merchant's brand and grow its business. Co.'s platform provides merchants with a single view of their business and customers across all of their sales channels and enables them to manage products and inventory, process orders and payments, build customer relationships and leverage analytics and reporting.

Solaris Oilfield Infrastructure

Solaris Oilfield Infrastructure is a holding company. Through its subsidiaries, the company is a provider of supply chain management and logistics solutions for the oil and natural gas industry. The company's offerings include: system rental, which manufactures and rents equipment to manage the delivery, handling and storage of proppant and chemicals at the well site; field services, which provides trained personnel to maintain and support its systems, train its customers to operate the systems and assist in the transportation of its systems; and transloading services, which provides manifest and unit-train transloading services, as well as provides forward staging storage of regional and local proppant.

Xinyi Solar Holdings Ltd.

Xinyi Solar Holdings is an investment holding company. Through its subsidiaries, Co. is principally engaged in the production and sale of solar glass products, which are carried out internationally, through the production complexes located in the People's Republic of China (the "PRC"). In addition, Co. is also engaged in the development and operation of solar farms and the provision of engineering, procurement and construction services in the PRC. Co.'s solar glass products mainly include ultra-clear PV raw glass and other PV processed glass such as ultra-clear PV tempered glass, ultra-clear PV anti-reflective coating glass, back glass and others.

Provider
Vermilion Research
Vermilion Research

Vermilion Research delivers timely, actionable, and unique research inputs to professional investors. Our research strategists highlight securities which we believe are at major inflection points, based on our various proprietary technical indicators, and offer asymmetric risk/return profiles. We believe our research methodology, which is not limited by industry sector or market capitalization, enables us to deliver superior investment recommendations.

Our process begins by organizing all actively traded stocks into coherent sectors, then into logical industry groups. We then apply our proprietary relative strength tools to identify developing price trends. Once attractive trends are identified within a selected sectors or groups, we screen for individual stocks which we believe offer the best risk/reward profile. Vermilion offers U.S. and global equity market research products. Vermilion’s research team, which has received numerous awards and accolades, has a combined 70 year of experience in the analysis of investment securities.

Analysts
Dave Nicoski

Ross LaDuke

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