Dave Nicoski ...
  • Ross LaDuke
EUR 222.98 For Business Accounts Only

Int'l Macro Vision: Sector Synopsis

Int'l Equity Strategy

Global equities were on a tear in early January, continuing the trend that began in 4Q2019. As global equities started to get extended, the coronavirus outbreak hit in mid-January, leading to some market setbacks and deterioration in market indicators as global growth expectations were dialed-in. Despite this deterioration, what was important to us was that there were not any breakdowns. Even the areas of the market most-directly affected by the outbreak -- China (MSCI China) and EM (MSCI EM) -- were not breaking down. To us, this was a reassuring sign of underlying strength, leading us to believe this equity bull market remains alive and well. As we detail below, our weight of the evidence approach continues to lead us to the same conclusions as we posited in our 1/24/20 and 1/30/20 Int'l Compass reports: we continue to believe this is a bull market until proven otherwise, and a “buy the dip” strategy remains warranted.

In our February International Strategy, we highlight various themes which lead to our bullish outlook:

• All of the major global indexes (MSCI ACWI, ACWI ex-US, EM, and EAFE) remain on bullish trajectories as coronavirus concerns effectively helped to correct the excess bullish sentiment in the short-term. Global indexes in uptrends and/or hitting new highs is arguably the most important leading economic indicator of all which helps lead us to our bullish outlook.

• Several indicators we watch in order to get a gauge on the health of the global economy and equity markets are holding up well and are supportive of our positive outlook, including (1) global cyclicals vs. staples ratios, (2) high yield spreads, (3) lumber prices, (4) copper prices, (5) WTI crude oil prices, (6) interest rates, and (7) Macau casino stocks.

• While these areas do not represent leadership, absolute patterns continue to show signs of bottoming for cyclical value areas of the market (e.g., Financials/Banks, Industrials, Major Auto Manufacturers, and Materials). Even the Energy Sector is holding above key support. As long as these areas are not breaking down in terms of price, we believe the global equity bull market remains viable.

• The US dollar (DXY) continues to move higher following the bullish inflection in January, and it is now testing 2019 highs near $99.70. At the same time, MACD continues to signal bearish divergence leading us to believe there is a low probability on the DXY hitting appreciably new highs. The recent move higher amid coronavirus concerns has led to some RS deterioration for MSCI EM, however if the DXY can stay below $100, EM has the potential to reassert itself as leadership.

In the remainder of our February International Strategy, we highlight areas of the market where we see actionable opportunities:

• Actionable Theme: Technology. The Vermilion equal-weighted international Technology Sector remains global leadership -- remain overweight/add exposure.

• Actionable Theme: Health Care. Global Health Care stocks (ex-US) have continued to outperform, to the point where the Vermilion equal-weighted international Health Care Relative Strength Ranking has closed the gap on Technology. Remain overweight/add exposure.
Ambu A/S

Ambu develops, produces and markets diagnostic and life-supporting devices. Co. has three business areas: Airway Management; Patient Monitoring & Diagnostics; and Emergency Care. Co.'s Airway Management products include laryngeal masks, face masks for artificial ventilation and scopes. The target groups for these products are hospitals and ambulance services. The Patient Monitoring & Diagnostics products comprise single-use electrodes for neurological and cardiological examinations. The target groups for these products are hospitals, clinics, ambulance services and sleep labs. The Emergency Care products comprise ventilation bags, neck collars and manikins for first-aid training.


Amplifon is multinational company engaged in the ddistribution, fitting, adaptation and personalization of hearing systems (hearing aids) designed to meet the needs of those suffering from hearing disabilities. Co. is also engaged in the sale of accessories such as batteries, consumables and spare parts, as well as in the distribution of biomedical devices. Co. is active in 20 different countries: Italy, France, Germany, Switzerland, The Netherlands, Belgium, Luxembourg, the U.K., Ireland, Spain, Portugal, Hungary, Turkey, the U.S., Canada, Australia, New Zealand, India, Egypt, and in Poland.

Bayer AG

Bayer is a life sciences group based in Germany. Co.'s operations are organized along three divisions: Pharmaceuticals (engaged in prescription pharmaceuticals for cardiology and women's healthcare); Consumer Health (engaged in non-prescription products in dermatology, dietary supplement, analgesic, gastrointestinal, allergy, cold and flu, foot care, sun protection and cardiovascular risk prevention categories); and CropScience (engaged in the development of seeds and plant traits; crop protection; and for gardens, the green industry and non-agricultural pest control). Co. also maintains an Animal Health business unit engaged in the development of products for farm and companion animals.

bioMerieux S.A.

Co. specializes in the field of in vitro diagnostics for clinical and industrial applications. Co. designs, develops, manufactures and markets systems used in: Clinical Applications (the diagnosis of infectious diseases such as hepatitis, HIV, tuberculosis and respiratory illnesses, as well as pathologies such as cardiovascular diseases and cancers, based on the analysis of biological samples such as blood, saliva or urine); and Industrial Applications (microbiological analysis of samples of finished or semi-finished products (or of the environment), chiefly in the food processing and biopharmaceutical industries), detecting microorganisms in agri-food, pharmaceutical and cosmetic products.

Capcom Co. Ltd.

Capcom is engaged in the development, manufacture and sales of video games, online games, mobile games and arcade games, as well as the operation of amusement arcades. Co.'s business segments are digital contents, amusement facility and amusement equipment. Co. is engaged in the planning, development, manufacture and sales of home video games, online games and mobile games including "Rockman," "Monster Hunter World" and "Dragons Dogma"; the operation of "Plaza Capcom" amusement facilities in Japan; and the development, production and distribution of arcade games for amusement facilities. Co. is also engaged in the licensing business of game characters and the real estate leasing business.


DIP is mainly engaged in the provision of job information and employment agency business through Internet. Co. is engaged in the operation of a part-time job information site "Baitoru" and a human resource dispatching information site "Hatarako Net"; and the provision of job information site "Bitoru Next" which is used by both permanent job seekers and recruiting agents. Co. also provides employment agency service site "Nurse de Hatarako" especially for nurses and assistant nurses. In addition, Co. is involved in the sale of a new material called “LIMEX” which substitutes for limestone-based paper and plastics.

Fresenius Medical Care AG

RegistrarFresenius Medical Care is a kidney dialysis company, operating in both the field of dialysis services and the field of dialysis products for the treatment of end-stage renal disease (ESRD). Co.'s dialysis business is vertically integrated, providing dialysis treatment at dialysis clinics it owns or operates and supplying these clinics with a range of products. In addition, Co. sells dialysis products to other dialysis service providers. In the U.S.A., Co. also provides inpatient dialysis services and other services under contract to hospitals. Co. provides patient services, including renal pharmaceutical products and in the U.S.A., laboratory services.

Galaxy Entertainment Group

Galaxy Entertainment is an investment holding company, engaged in operation in casino games of chance or games of other forms, as well as the provision of hospitality and related services in Macau. In addition, Co. manufactures, sells and distributes construction materials through its Construction Materials Division across Mainland China, Hong Kong and Macau. Co.'s segments include gaming and entertainment, and construction materials.

Genmab A/S

Genmab is a biotechnology company specializing in the creation and development of differentiated human antibody therapeutics focused on the treatment of cancer. Co.'s product pipeline includes one marketed product, Arzerra, daratumumab in late stage clinical development, four antibodies in clinical development, and over 20 in-house and partnered pre-clinical programs. Co.'s Arzerra (ofatumumab) is a human monoclonal antibody which targets an epitope on the CD20 molecule. Co.'s proprietary technologies include the DuoBody technology, which creates antibodies that can target two molecules at once, and the HexaBody technology, which allows for the creation of more potent antibodies.

Giga-Byte Technology Co. Ltd.

Giga-Byte Technology is engaged in the activities of the manufacturing, processing and selling of computer hardware, components and other peripheral facilities, the provision of investment services, notebook manufacturing and trading, sales of display card. Co.'s main products are defined in three fields of motherboard, graphic speed-up card and proven system products. Co.'s business operations are carried out in Taiwan, Holland and other countries. Co. exports its products in Asia, Europe, the United States of America, Canada and other countries.

Infineon Technologies AG

Infineon Technologies is a semiconductor manufacturing company. The Automotive segment designs, develops, manufactures and markets semiconductors for use in automotive applications. The Industrial Power Control segment designs, develops, manufactures and markets semiconductors for the generation, transmission and economy in the use of electrical energy. The Power Management & Multimarket segment designs, develops, manufactures and markets semiconductors for power supplies, mobile devices and mobile phone network infrastructures. The Chip Card & Security segment designs, develops, manufactures and markets semiconductor-based security products for card applications and networked systems.


Kinaxis Inc. is a provider of cloud-based subscription software for supply chain operations. The Company offers RapidResponse as a collection of cloud-based configurable applications. The Company's RapidResponse product provides supply chain planning and analytics capabilities that create the foundation for managing multiple, interconnected supply chain management processes, including demand planning, supply planning, inventory management, order fulfillment and capacity planning. The Company's customers include companies in various industries, including high technology and electronics; aerospace and defense; life sciences and pharmaceuticals; industrial, and automotive. Its sales and operations planning solutions include demand planning, aggregate supply planning, capacity planning (constraints), inventory planning and optimization, and inventory management. The Company's supply chain management applications include capacity planning, order fulfillment and supplier collaboration.

Lonza Group AG

Lonza supplies services and products that range from active pharmaceutical ingredients and stem-cell therapies to drinking water sanitizers, from vitamin B compounds and organic personal care ingredients to agricultural products, and from industrial preservatives to microbial control solutions. Co. operates in two segments: Lonza Pharma & Biotech, which clusters all of Co.'s offerings for pharmaceutical markets, focuses on providing custom development, custom manufacturing, cell therapy, viral therapeutics and bioscience solutions; and Lonza Specialty Ingredients, which includes offerings in its consumer care, agro ingredients, industrial solutions, wood protection and water treatment.

Macronix International

Macronix International is engaged in the research, development, design, manufacture, examine and selling of integrated circuits and various semiconductor parts, and its system application products including memory chips, communication system products, computer and its related system products, consumption electronic system products, computer multimedia system products and automatic electromechanical set products; provision of consultation service on the related products; photoelectric elements and spare parts; design of computer software program; processing of computer information; and the operation of Co.'s related products import and export trading services.

Melco Crown Entertainment Ltd. ADS

Novartis AG

Novartis is a multinational healthcare group based in Switzerland. Co. provides healthcare solutions that address the evolving needs of patients and societies worldwide. Co.'s broad portfolio includes innovative medicines, eye care products and cost-saving generic pharmaceuticals. Co.'s operations are organized along three operating divisions: Innovative Medicines Division; Sandoz Division; and Alcon Division. Co.'s operations are supported by the Novartis Institutes for BioMedical Research and Novartis Business Services.

Open Text Corp.

Open Text is a provider of a suite of software products and services that assist organizations in finding, utilizing, and sharing business information from any device. In addition, Co. provides solutions that facilitate the exchange of information and transactions between supply chain participants, such as manufacturers, retailers, distributors and financial institutions. Co. provides software through on-premise solutions, cloud solutions or a combination of both on-premise and cloud solutions. Co.'s enterprise information management offerings include: content services, business process management, customer experience management, discovery, business network, and analytics.

Realtek Semiconductor Corp.

Realteck Semiconductor is a fabless designer and supplier of integrated circuits for network interface cards, or NIC ICs, and switches used in local area networks, or LANs. Co.'s principal products are the 10Mbps Ethernet and 100Mbps Fast Ethernet NIC ICs. Co. also designs and supplies integrated circuits for PC peripherals and multimedia products. Co.'s product lines comprised of data, voice, and image ICs. Co. organized its operation into five divisions: Communications Network Business Unit, Communications Network Marketing & Sales Division, Computer Peripheral Business Unit, Multi-Media Business Unit, UWB (Ultra-Wide Band) Business Unit.

Samsung Electro-Mechanics

Samsung Electro-Mechanics manufactures, markets and distributes devices, parts and components. These are parts and components for mobile communications, computer components and peripherals, materials, general and industrial use, optical/thin film and audio and video. Co.'s products consists of flyback transformers, radio frequency modulators, low noise block-down converters, VCR drums, VCR heads, VCR drum motors, electronic tuners, multi-layer ceramic capacitors, deflection yokes, RF-units, high voltage capacitors, speakers, decks, keyboards, switching mode power supplies, floppy disc drives, CD-decks, and broadcasting satellite receivers.

Samsung Electronics Co Ltd (GDR)

Sands China Ltd.


SAP is engaged in selling licenses for software solutions and related support services. Co. derives its revenue from fees charged to its customers for the use of its cloud solutions and for licensing of on-premise software products and solutions. Additional sources of revenue are support, professional services, development, training, and other services. Co. has more than 300,000 customers in over 180 countries. Co.'s SAP HANA platform holds the ability to simplify both the user experience and the overall IT landscape, creating a smaller data footprint, increased system throughput, and easier data processing and operation.

Sartorius Stedim Biotech

Sartorius Stedim Biotech is a provider of equipment and services for the development, quality assurance and production processes of the biopharmaceutical industry. Co.'s solutions cover fermentation, filtration, purification, fluid management and lab technologies and membrane chromatography, including various conventional lab products to biopharmaceutical laboratories. Co.'s technologies, products and services are used to develop and manufacture medications and vaccines using biological methods. Co.'s products covers all upstream and downstream steps in the production of active pharmaceutical ingredients. It specializes in single-use products and offers technical consulting and services.

Sino-American Silicon Products Inc.

Sino-American Silicon Products Inc. is a Taiwan-based company principally engaged in the research, development, design, manufacture and distribution of semiconductor silicon wafer materials and related components. The Company's principal products include solar silicon ingots, solar silicon wafers, semiconductor ingots, semiconductor wafers, solar cells and solar module products. The Company mainly operates through two business segments: semiconductor business segment and solar business segment. The Company is also engaged in the provision of related technology, management and consultancy services. The Company mainly operates its business in Taiwan, the rest of Asia and the Americas.

SK Hynix

SK hynix is engaged in the manufacture and sale of semiconductors and related devices. Co.'s memory semiconductors include dynamic random access memory ("DRAM") modules, multi-chip products (MCPs) and NAND flash memory semiconductors. Co.'s memory semiconductors are used for desktops, notebooks, smartphones, tablets, game consoles, MP3, PMP, USB drive, televisions, and digital cameras. Co. also develops non-memory semiconductors such as complementary metal oxide semiconductor image sensors used in digital imaging devices.

ST Pharm

ST Pharm Co Ltd. STPharm Co.,Ltd. is a Korea-based company principally engaged in manufacture of pharmaceutical products. The Company's products mainly consist of generic active pharmaceutical ingredients (APIs), such as tipepidine hibenzate, doxifluridine, clopidogrel bisulfate, voriconazole and new medicine APIs, such as small molecule APIs. The Company distributes its products within domestic market and to overseas markets.

STMicroelectronics N.V. ADS

Swedish Orphan Biovitrum AB

Swedish Orphan Biovitrum AB is a healthcare company focused on rare diseases. Co. develops, manufactures and commercializes treatments with a particular focus on four therapeutic areas: Inflammation, Genetics & Metabolism, Haemophilia and Neonatology. Co. also markets a portfolio of rare disease products for partner companies. Co.'s pipeline programmes include research and development focused on recombinant protein drugs in late preclinical and clinical phase for indications.

Tecan Group AG

Tecan provides laboratory instruments and automation solutions. Co. also provides solutions for various applied markets such as forensics, the food industry, crop research, the cosmetic industry and veterinary applications. Co.'s automation solutions include instruments, software packages, and configurable modules as well as regulatory and quality consulting, service and consumables. Co.'s segments include life sciences business, which supplies end users with automated workflow solutions directly; and partnering, which develops and manufactures OEM instruments and components that are distributed by partner companies under their own names.


Technos Relogios is a distributor and seller of watches, and timepiece parts for consumer use. The principal watch brands are BR, CARAS, Honda, Bosch, Cache, Bardahl, Antarctica, Fiat, Technos,Goettems, Mormaii and Seiko. As of Dec 31 2004, Co. also maintained a factory in Manaus.

Ubisoft Entertainment S.A.

Ubisoft Entertainment is an international independent developer, publisher & distributor of video games. Co. centers its business activities on developing, publishing & distributing video games for portable & home consoles, the PC, smartphones & tablets in both physical & online formats: high-definition with games for Xbox 360, PlayStation®3 & PC; casual with games for Nintendo®, KINECT & PlayStation®3 Move; and online for on-line games. Co.'s catalogue includes various types of games: Action/Adventure, Shooters, Sports, Strategy, Simulation, TV and Movie licenses, Games for everyone and Driving. Co.'s trademarks include Assassin's Creed®, Rainbow Six® Vegas 2, and Rayman Raving Rabids®.

Vifor Pharma AG

Vifor Pharma is a holding company. Through its subsidiaries, Co. develops, manufactures and markets pharmaceutical products, runs pharmacies, provides logistical and database services and sets up networks. Pharma markets pharmaceutical iron-based products and offers a broad range of OTC products, prescription products, herbal remedies and parapharmaceutical products. Logistics delivers supplies to pharmacies, physicians, drugstores and hospitals and also handles and coordinates the purchase, sale, warehousing and distribution of products for third parties. Healthcare Information provides ways of networking the healthcare market. Retail runs pharmacies and participates in Coop Vitality.

Wynn Macau Ltd

Wynn Macau is a holding company. Co. is a developer, owner and operator of destination casino gaming and entertainment resort facilities in Macau. Through its subsidiary, Wynn Resorts (Macau) S.A., Co. owns and operates the destination hotel and casino resort Wynn Macau in Macau. In addition, Co. is engaged in the development, design and preconstruction activities.

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.

Dave Nicoski

Ross LaDuke

Other Reports on these Companies
Other Reports from Vermilion Research
Dave Nicoski ...
  • Ross LaDuke
Other Reports from these Analysts
Dave Nicoski ...
  • Ross LaDuke

ResearchPool Subscriptions

Get the most out of your insights

Get in touch