Today’s must-reads in Asia, curated by O’Neil Research Analysts. Asia Watch. |
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| January 12, 2018 | Derek Higa 310.448.6910 |
Retail/Consumer CyclicalCHINA’S MOVIEGOERS ARE CHOOSING A SEXIST HOMEGROWN COMEDY OVER “THE LAST JEDI” (qz) JD.com Partners with “China’s Pinterest” on New WeChat Sales Venture (jingdaily) TechnologyA Chinese company you’ve never heard of beat Samsung to the punch by putting a fingerprint sensor underneath a smartphone’s screen (bi) Huawei’s big US push is in tatters after AT&T canceled a distribution deal for its latest phone (bi) CryptocurrencyPolice are raiding bitcoin exchanges in South Korea (qz) Automated Trading Firm Plans Crypto Hires in Asia and Office in China (Bloomberg) South Korea might ban cryptocurrency trading (fc) Consumer StaplesIndia’s consumer goods firms hope monsoons and elections will rain money (qz) MacroeconomicThis country will trigger ‘the great unwind’, according to SocGen’s permabear Albert Edwards (marketwatch) Why China’s record trade surplus with US could be a headache for Beijing (scmp) Chinese Workers Abandon Silicon Valley, for Riches Back Home (Bloomberg) The bright spot in India’s dismal job market: freelancing (qz) MISCVending machines are everywhere in Japan — here are the strangest places to find them (bi)
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| WILLIAM O’NEIL+CO | Institutional Sales | 12655 Beatrice Street | Los Angeles, CA 90066 | 800.545.8940 | |
| William O’Neil + Co. Incorporated is a Registered Investment Advisor with the State of California and certain other states. Employees of William O’Neil + Company and its affiliates may now or in the future have positions in securities mentioned in this communication. Our content should not be relied upon as the sole factor in determining whether to buy, sell, or hold a . For important information about reports, our business, and legal notices please go to williamoneil.com/legal. | |
Author: Derek Higa
Derek Higa is a senior equity analyst and a lead for the APAC region and the Consumer Cyclical sector. He serves on the Global Focus List Committee, which approves all equity recommendations for developed, emerging, and frontier markets, and compiles Asia Watch, a weekly recap of regional investing news. Since joining William O’Neil + Company in 2005, he has lent his market expertise to alpha capture, product development, and historical studies on outperforming stocks. Derek graduated summa cum laude from California State University Los Angeles with a B.S. in Finance and Information Systems. He holds a Series 65 securities license.
APAC Weekly Summary
Over the last two weeks, the MSCI Asia have held strongly at the 50-DMA. Furthermore, strong action over the last few days have relieved most of the pressure that was seen in December. Volume is still on the light side with the A/D trend having yet to turn more positive but we are encouraged by the strong action in individual APAC markets such as Hong Kong (more below). This, along with declining distribution days has led us to take a more bullish sentiment on APAC markets to start 2018.
Asia Watch
Today’s must-reads in Asia, curated by O’Neil Research Analysts. Asia Watch. |
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| December 22, 2017 | Derek Higa 310.448.6910 |
Retail/Consumer CyclicalInfrastructure needs put a drag on fuel cell vehicle popularity. (japantimes) Toyota Plays Catch-Up With Plans for More Than 10 EV Models (wsj) Is China Finally Coming Around to Chinese Supermodels? (jingdaily) Pixar’s Coco has made more money in China than at home (qz) Subaru orders skid 30% in Japan amid inspection scandal (japantimes) Who is Kris Wu? Meet the Millennial Idol Bringing Chinese Hip Hop to a Global Stage (jingdaily) Self-Driving Cars/Ride sharingBaidu & NXP Semiconductors Collaborate on Self Driving Cars (nasdaq) Didi’s next trick is to go global (techinasia) Technology2017: When India’s startups came of age, herded by Softbank’s big bucks (qz) FinancialBofA Is Jockeying to Handle More China Debt Sales, Moynihan Says (bloomberg) MacroChina Shrugs Off Debt Worries as Xi Takes Firmer Economic Grip (nytimes)
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| WILLIAM O’NEIL+CO | Institutional Sales | 12655 Beatrice Street | Los Angeles, CA 90066 | 800.545.8940 | |
| William O’Neil + Co. Incorporated is a Registered Investment Advisor with the State of California and certain other states. Employees of William O’Neil + Company and its affiliates may now or in the future have positions in securities mentioned in this communication. Our content should not be relied upon as the sole factor in determining whether to buy, sell, or hold a . For important information about reports, our business, and legal notices please go to williamoneil.com/legal. | |
APAC Weekly Summary
Through Wednesday, the MSCI Asia traded below its 50-
MA again. Accumulation/
istribution (A/
) volume remains tilted negative. Furthermore, the A/
rating (
) continues to deteriorate from last week (
+). Thus, we are still cautious on overall APAC markets as we close out 2017. The heavy volume decline on Tuesday was significant and an indication that APAC markets for the most part, will continue to consolidate near term in our view.
Asia Watch
Today’s must-reads in Asia, curated by O’Neil Research Analysts. Asia Watch. |
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| December 15, 2017 | Derek Higa 310.448.6910 |
Retail/Consumer CyclicalPaying 15 cents more for your T-shirt : would help Indian workers earn a living wage (qz) Car-sharing trend : is taking off (chinadaily) Alibaba invests in electric car startup(techinasia) A private car maker is frantically funding public transport in China(qz) An Indian lifestyle brand is using Bollywood celebrities to curate your wardrobe(qz) TechnologyA Chinese billionaire has quietly become one of the biggest seed investors in Silicon Valley (qz) Big Boss Nintendo Seeks New Sidekicks in Smartphone Battle(wsj) Capital EquipmentNvidia and construction giant Komatsu partner on AI for job site safety (techcrunch) PollutionChina Doesn’t Want Our Trash Anymore, So We Need To Recycle Smarter (fastcompany) MacroeconomicChina Audit Finds Provinces Faked Data and Borrowed Illegally.(bloomberg) How South Korea names and shames tens of thousands of tax-dodgers every year,(bi) MISCNorth Korean soldier who defected has been granted Choco Pies for life — a snack Kim Jong Un hates (bi)
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| WILLIAM O’NEIL+CO | Institutional Sales | 12655 Beatrice Street | Los Angeles, CA 90066 | 800.545.8940 | |
| William O’Neil + Co. Incorporated is a Registered Investment Advisor with the State of California and certain other states. Employees of William O’Neil + Company and its affiliates may now or in the future have positions in securities mentioned in this communication. Our content should not be relied upon as the sole factor in determining whether to buy, sell, or hold a . For important information about reports, our business, and legal notices please go to williamoneil.com/legal. | |
APAC Weekly Summary
Distribution days remain above four for the second consecutive week as Hong Kong, Japan, Korea and India each record at least one over the last five trailing days. Distribution remains elevated which makes us still uncomfortable despite the rebound. It is not unusual for markets to find short term support after a significant sell off and equally, it is not unusual to see them fail. Thus, we believe it is just too early to be “buying the dips.”
Asia Watch
Today’s must-reads in Asia, curated by O’Neil Research Analysts. Asia Watch. |
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| December 8, 2017 | Derek Higa 310.448.6910 |
Retail/Consumer CyclicalDecoding Chinese Millennials: Navigating Gender Roles (jingdaily) No free lunch: Japan turns to convenience stores in bid to reduce unpaid public school meal fees (japntimes) BYD Auto’s new energy sales targets reveal optimism for a bumper 2018 (chinadaily) Asian demand for glitz puts sparkle in Tiffany profits (japantimes) Guangzhou Automobile plans design studios in LA, Shanghai (chinadaily) TechnologySpotify and Tencent just agreed to a huge deal (techinasia) Nintendo opens games to rival console for first time with China-only Nvidia tie-up (japantimes) Baidu, Xiaomi partner on AI, internet of things (chinadaily) Eight ways English is creeping its way into Chinese, as explained by a Chinese YouTuber (qz) INSIDE BAIDU’S BID TO LEAD THE AI REVOLUTION (wired) FinancialHong Kong Unveils Investor ID Plan for China Trading Link (bloomberg) PollutionEnvironmentalists Ask: Is India’s Government Making Bad Air Worse (nytimes)
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| WILLIAM O’NEIL+CO | Institutional Sales | 12655 Beatrice Street | Los Angeles, CA 90066 | 800.545.8940 | |
| William O’Neil + Co. Incorporated is a Registered Investment Advisor with the State of California and certain other states. Employees of William O’Neil + Company and its affiliates may now or in the future have positions in securities mentioned in this communication. Our content should not be relied upon as the sole factor in determining whether to buy, sell, or hold a stock. For important information about reports, our business, and legal notices please go to williamoneil.com/legal. | |
APAC Weekly Summary: Distribution Rises, Caution Advised, Global Laggards (Pigeon)
We are shifting our sentiment on APAC markets to Under Pressure and advise a cautious approach. For the first time this year the MSCI Asia gapped below the 50-DMA, a level it has not breached all year. Distribution is rising again in many markets including Hong Kong, Japan, S. Korea, and India. Furthermore, these markets are either testing or have fallen below respective support levels in recent days. We advise reducing risk and scaling back. We do not believe it is the right time to be buying on pull backs.
APAC Weekly Summary
The MSCI Asia has stayed in character pulling back again further after making new 52‐week highs last week. The benchmark is 2% from the 50‐DMA with another test seeming inevitable. Distribution is still low on average and this is not enough to change our sentiment as the trend again remains largely intact. We are still bullish but with many names extended, trimming or scaling down at this point in the rally is acceptable in or view.
APAC Weekly Summary
There is no change to our bullish sentiment on APAC markets. Like clockwork, the MSCI Asia has returned to 52-week highs again maintaining its trend throughout 2017. Accumulation volume since late September has also sustained a positive trend, turning upward again through Wednesday. Worth pointing out are the last two attempts, October 26 and more recently November 15, when the benchmark tested the 50-DMA. The retesting of the moving average has gotten less severe and the pull back less deep (-2% off high) versus prior retests (-4%). Consolidation is also in a tighter range. This action is bullish in our view and could suggest a change in character. Thus far, the benchmark has traded consistently but it would not be surprising (especially given strong action in Hong Kong this week, more below), to see it break above its upward channel line and begin to accelerate higher.
