Vermilion Int'l Compass: Global Equity Strategy
Stick With Global Technology; China Breaking OutWe 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), with Int'l Compass reports all echoing this sentiment. We will maintain our bullish intermediate-term view as long as market dynamics remain healthy and the SPX and ACWI-US are above 6028-6059 and $125-$126. Our bullish near-term outlook will remain in place as long as the 4+ month uptrend continues on ACWI-US. Short-term supports to watch on ACWI-US include the 4+ month uptrend (currently at $136), $134-$134.50, $131.50-$132, $130, $128, and $125-$126. Market dynamics remain overwhelmingly risk-on; there is every reason to remain bullish and we continue to expect more upside into year-end and the early part of 2026.
Remain Overweight Taiwan, China, Korea, and the U.S. Our four country overweights include Taiwan (TAIEX), China (Shanghai Composite), Korea (KOSPI), and the U.S. (S&P 500). Most of our top ideas are within these countries. With that said, we are buying the 7-month base breakout in Europe (EURO STOXX 50), where RS is also reversing above its 5-month downtrend. Meanwhile, Japan's TOPIX index is back at new highs and we see many attractive buy opportunities. We expected more consolidation after the TOPIX violated its 20-day MA for the first time since late-April last week, but there was zero reason to get bearish as we mapped out support levels to buy. China's Shanghai Composite is also breaking out above 1-month resistance -- buy/stay long... see page 2.
Emerging Markets Overview. We remain bullish on EM with the 5-month uptrend intact on MSCI Emerging Markets (EEM-US). We expect support at the uptrend and 50-day MA, and also $52.35. Taiwan, China, and Korea remain our favorite EM countries to be buying/overweight. In terms of Sectors, MSCI EM Technology, Communications, Materials, and Consumer Discretionary are our four favorites to be buying/overweight.
Actionable Themes: Technology, Health Care, Industrials, and Utilities. Technology remains global leadership, while global Health Care stocks are improving. We also highlight buy ideas within Industrials and Utilities... see pages 3-24.
A-SPINE ASIA CO., LTD. is a Taiwan-based company mainly engaged in the research, development, production and sale of spinal implants and spinal surgical instruments, as well as the sale of imported implantable orthopedic related medical materials. The Company is engaged in the provision of spine fixation system, spinal fusion system, vertebral body replacement system and bone filling system products. The spinal fixation system includes WinLoc II, CervoLoc, SmartLoc, SmartMIS, PACH and other products, used for spinal fixation and thoracolumbar fixation. The spinal fusion system includes products such as Combo cervical and lumbar intervertebral disc fusion devices, used for spinal reconstruction surgery. The vertebral body replacement system includes products such as A-Mesh titanium mesh, used to provide stable support for vertebral body. The bone filling system includes products such as Avalon vertebral expander, used for intervertebral distraction.
Auras Technology Co.,Ltd.. AURAS Technology Co., Ltd. is a Taiwan-based company engaged in the manufacture, processing and distribution of computer cooling modules. The Company's cooling modules, which consist of radiator fans, cooling plates and heat pipes, are applied to notebook computers, desktop computers and other information electronic products. The Company distributes its products within the domestic market and to overseas markets, including the rest of Asia, Europe and the Americas.
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.
DISCO and its affiliates are mainly engaged in the manufacture, sale and maintenance of precision cutting, grinding and polishing machines. Co. is also engaged in the manufacture and sale of precision diamond abrasive tools, and disassembly and recycling of precision cutting, grinding and polishing machines. Co.'s principal precision machines are dicing and cutting saws, laser saws, grinders, polishers, wafer mounters, die separators, surface planers, water jet saws, and products for new processes. Co.'s principal precision processing tools are dicing blades, grinding wheels, and dry polishing wheels.
Fujikura is mainly engaged in the manufacture, sale and installation of telecommunication cable, electric cable and electronic materials. Along with its affiliates, Co. operates in four business segments: power & telecommunication systems, electronics business, automotive products and real estate. Co.'s principal products include power cables, telecommunication cables, aluminum wires, enameled wires, optical fibers, optical fiber cables, telecommunication and optical components, fiber optic equipment, network equipment, flexible printed circuits, electronic wiring, HDD components, connectors, automotive wire harnesses, and others. Co. is also engaged in the leasing of real estate.
HORIBA and its affiliates are engaged in the manufacture and sale of measuring instruments and analytical instruments. Co.'s business segments are automotive test systems, process & environmental instruments & systems, medical-diagnostic instruments & systems, semiconductor instruments & systems, and scientific instruments & systems. Co.'s principal products are emission measurement systems, automotive emission analyzers, and on-board emission measurement systems; scientific analysis instruments and environmental measuring instruments; equipment for blood sample analysis; mass flow controllers, chemical concentration monitors, and thin-film analyzers; and scientific analysis instruments.
Rorze is a manufacturing company engaged in the development, design, manufacturing, and sales of electronic device and automation system such as handling system for semiconductor/FPD production. The Semiconductor and liquid crystal related device segment provides wafer handling equipment such as atmospheric wafer transfer device, vacuum wafer transfer device and wafer transport unit; glass substrate handling equipment including large glass substrate transport device and glass cutting machine; and motor control equipment which supports its wafer and glass substrate handling systems. The Life science related equipment segment provides cell culture devices for drug discovery industry.
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.
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