Report
Dave Nicoski ...
  • Ross LaDuke
EUR 47.74 For Business Accounts Only

Vermilion Int'l Compass: Global Equity Strategy

No Traction Above $93 on MSCI ACWI (ACWI-US) or 4400-4415 on EURO STOXX 50

There continues to be little traction above $93 on the MSCI ACWI (ACWI-US), which remains the top-end of our anticipated 2023 trading range. Important downside targets are $86, $84, and $75-77 on ACWI-US. Additionally, the EURO STOXX 50 remains below 2-year resistance at 4400-4415. We remain overweight Europe, Japan, and India, and we prefer to only add exposure on a pullback -- especially in Japan where indexes are bullish yet extended.

Europe. We continue to recommend an overweight to Europe with the RS uptrend intact on the STOXX Europe 50 index. With that said, RS on the EURO STOXX 50 index has flattened, and price remains below 4400-4415 resistance that we initially discussed in our 4/27/23 Int'l Compass; we expect pullbacks to the 4000-4100 area to be buying opportunities, and we will continue to monitor RS closely... see chart below.
Japan Remains Bullish Yet Extended. Japan's Nikkei 225 has joined the TOPIX in breaking out to 33-year highs (TOPIX did it last week). Japan remains undoubtedly bullish, yet is extended. Meanwhile, the TOPIX Small index remains just below its 2021 highs. We continue to recommend an overweight to Japan, but we prefer to only add exposure on a pullback to the 1950-2000 range on the TOPIX, as the indexes and countless stocks that we have been recommending are getting extended.
Actionable Theme: Defensives. With global equities (ACWI-US) testing resistance, we continue to favor defensives. We highlight our favorite names to buy/stay long within Consumer Staples, Health Care, Telecommunications, and Utilities... see pages 2 and 4-10.
Actionable Theme: Cyclicals w/ Japan & Emerging Market Focus. Cyclical Sectors continue to lead within Japan, and we are also starting to see meaningful improvement within emerging markets such as Taiwan, India, and South Korea. Sectors highlighted include Financials, Industrials/Transportation, Technology, and Services... see pages 3 and 10-18.
Underlyings
Emerging Display Technologies Corp.

EMERGING DISPLAY TECHNOLOGIES CORP. is a Taiwan-based company principally engaged in the design, manufacture and sale of electronic parts and computer peripherals products. The Company's primary products include liquid crystal displays (LCDs) and capacitive touch panels (CTPs). The Company's products are primarily used in the manufacturing of notebook computers, desktop computers, portable electronic products, LCD televisions (TVs), electrical toys, mobile phones, electronic calculators and other electronic instruments. The Company mainly operates through four business segments: Taiwan segment, the Americas segment, the Mainland China segment and others segment. The Company mainly exports its products to the Americas, Asia and Europe.

Enel SpA

Enel Societa Per Azioni is engaged in the generation and sale of electricity through its Generation, Energy Management and Sales Italy Division. Co. is also engaged in the distribution of electricity (Enel Distribuzione) and public and artistic lighting (Enel Sole) in Italy through its Infrastructure and Networks Division. Co.'s Iberia and Latin America Division coordinates Co.'s operations in the electricity and gas markets in Spain, Portugal and Latin America. Co.'s Engineering and Research Division manages the engineering processes related to the development and construction of power plants. Co.'s other divisions are the International Division as well as the Renewable Energy Division.

Hi-Level Technology Holdings

Hi-Level Technology Holdings Limited is a Hong Kong-based investment holding company principally engaged in the sales of electronic components for electronic products. Its electronic components mainly include integrated circuits and panels. These components are used for electronic learning appliances, mobile Internet devices, set-top boxes, multi-media players and video image devices. The Company also provides independent design house services for original brand manufacturers and original design manufacturers. It is also involved in the provision of engineering support through its subsidiaries. The Company operates businesses in China, Hong Kong and Taiwan.

ITC LTD

ITC is a diversified manufacturing and marketing company which is based in India. Co. maintains an operating presence in Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, Packaged Foods & Confectionery, Information Technology, Branded Apparel, Personal Care, Stationery, Safety Matches and other FMCG products. While Co. is an outstanding market leader in its traditional businesses of Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports, it is rapidly gaining market share even in its nascent businesses of Packaged Foods & Confectionery, Branded Apparel, Personal Care and Stationery.

Nien Made Enterprise Co. Ltd.

Nien Made Enterprise Co Ltd. Nien Made Enterprise Co., Ltd. is a Taiwan-based company principally engaged in the production and sales of curtains and curtain parts. The Company's main products include shutters, soft shades and blinds. The Company distributes its products in domestic market and to overseas markets, such as the Americas and Europe.

TOKYO GAS Co. Ltd.

Tokyo Gas is engaged in the production, supply and sale of gas. Co.'s principal business segments are city gas, electric power, overseas, energy-related and real estate. Co. uses its four LNG terminals along the shores of Tokyo Bay to gasify LNG, its main gas resource. As of Mar 31 2018, Co. produced 15,457,733,000 cubic meter of gas and had 11,678,000 gas customers. Co. sell gas cook tops, water heaters, gas air conditioning systems, liquefied petroleum gas, and gas for industrial and chemical products. Co. also leases and managements of office buildings; and provides system integration, shipping, and credit and lease.

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

Other Reports on these Companies
Other Reports from Vermilion Research

ResearchPool Subscriptions

Get the most out of your insights

Get in touch