Where Is The Correction?

Download PDF: For over a year, investors have been rewarded for tilting their portfolio towards risk assets on the backdrop of plentiful support for households from the government’s generous fiscal transfer that supported spending and Fed’s support on the credit market, preventing a crunch in liquidity of the debt market. The unprecedented fiscal and monetaryContinue reading “Where Is The Correction?”

Yields Meltdown, Excess Savings and EM Policy Rate

Download PDF: Global stocks continue to experience a dichotomy in recent months amid unequal economic recovery in the developed and emerging world. With vaccination rate crossing above 50% of total population and covid-19 number goes into the rear-view mirror in the rich world, both manufacturing and service sector has rebounded strongly amid last year’s pent-upContinue reading “Yields Meltdown, Excess Savings and EM Policy Rate”

Research Note: South Africa Local Curve

Download PDF: South African local curve will likely continue to bear flatten in the coming months as the central bank start to raise policy rate as inflationary pressure rises – in line with other EM countries. Currently we see sufficient spread of ZA 10-year bonds against global benchmark amid the backdrop of abundant global liquidityContinue reading “Research Note: South Africa Local Curve”

$100 Oil? Crude Outlook, Russia and Saudi

Download PDF: Recent weeks have seen oil price keeps on climbing despite the thawing tension between U.S.-Iran relation that potentially bring additional 1.5 mb Bbl/day supply into the market. We are expecting a continued strong global recovery this year and restraint from Saudi and Russia in ramping up production, as currently the two countries’ oilContinue reading “$100 Oil? Crude Outlook, Russia and Saudi”

EM Strategy and Dissecting EM Stocks Performance

Download PDF: Potential peak in U.S. Treasury yield and copper/gold ratio, and gangbuster data coming from China, U.S., and Europe point to the passing of maximum growth momentum in post-pandemic recovery. Despite the pandemic still raging in parts of the world, especially in EM countries, strong recovery in China and the developed world mean ultra-easyContinue reading “EM Strategy and Dissecting EM Stocks Performance”

Peak Growth: Cycle in Review, Commodities, and Precious Metals

Download PDF: Blow-out number of various economic indicators coming in the past weeks – PMI, retail sales, inflation – suggest that the global cycle is peaking out and the strongest period of growth is in the rear-view mirror.  In the short-term, the risk assets rally that began in March 2020 is likely to take aContinue reading “Peak Growth: Cycle in Review, Commodities, and Precious Metals”

The Semi Shortage

Download PDF: In the past three decades the world has seen a dramatic digital transformation happening with the widespread adoption of internet, computers, and smartphones, which only accelerated when lockdown restriction last year pushed our life further into the digital realm. Demands of electronic gadgets, data centers, and networking equipment surged in 2020 as businessesContinue reading “The Semi Shortage”

World Earnings and Valuation, Silver, EM Inflation

Download PDF: Developed World: Earnings and Valuation Outlook Earnings for most sector has recovered to pre-pandemic level, with health care and IT sector posting strong earnings in Q1. Growth expectations for both sectors, and materials, are strong and valuation is not demanding for the later. We believe that we are entering a structural bull marketContinue reading “World Earnings and Valuation, Silver, EM Inflation”

EM Equity Earnings and Valuation Outlook

Download PDF: EM Equity Earnings Outlook The broad EM benchmark has rallied hard in the past year and is now some 15% above the pre-pandemic level. After the fall in earnings for most EM countries – with EM benchmark’s earnings currently still 17% below January 2020 level – the market is now expecting sharp earningsContinue reading “EM Equity Earnings and Valuation Outlook”

EM Review: Chile, Brazil, Indonesia and Mexico

Download PDF: Chile The cyclical bullish case for Chilean stocks is straightforward. Chilean earnings are set to improve dramatically from the higher copper prices, which will continue to enjoy structural boost from electrification of vehicle and green energy infrastructure demand, as discussed in a previous report. Chinese imports continue to pose strong number in recentContinue reading “EM Review: Chile, Brazil, Indonesia and Mexico”