Download PDF: 202102_turkey_brazil_pcDownload Stay Positive on Brazilian Assets The backdrop for Brazilian assets remains bullish amid rising commodity prices and undervalued Real (Chart 1). In addition, Brazilian economy has recovered strongly and various indicators – such as manufacturing PMI and retail sales – are now back to pre-pandemic level (Chart 2). With the global economyContinueContinue reading “On Brazil and Turkey”
Tag Archives: strategy
March 2021: Thoughts on Valuation, Oil, and Silver Demand
Download PDF: monthly_202103Download Part I. World’s Equity Valuation One year after the Covid-19-induced market crash, global equity market has gone through a V-shaped recovery with stock market in many countries breaking record high level amid ample monetary and fiscal stimulus. The U.S. market valuation – now trading at cyclically-adjusted P/E (CAPE) of 32 times –ContinueContinue reading “March 2021: Thoughts on Valuation, Oil, and Silver Demand”
EM Taper Tantrum Déjà vu?
Download PDF: em-and-taper-tantrum_pcDownload Potential for Sizable Portfolio Outflow is Limited. The period before 2013 Taper Tantrum was marked by strong capital flow into EM assets, in contrast to current situation where flow into EM bonds and equities are only beginning to recover (Chart 1). More importantly foreign ownership of EM bonds, especially for the moreContinueContinue reading “EM Taper Tantrum Déjà vu?”
February 2021: EM Bonds, Brazil and Turkey
Download PDF: monthly_202002Download EM local-currency bonds EM bonds still have room for spread tightening against U.S. Treasury. The 10-year Treasury yield will have difficulty to break 1.2% level as the Fed is unlikely to raise rate until inflation overshoot its 2% target, creating an anchor for yields globally to remain low. Moreover, the relatively modestContinueContinue reading “February 2021: EM Bonds, Brazil and Turkey”
January 2021: Silver and Equity Strategy Review
Download PDF: monthly_202101Download Part I: Silver Last week seen silver prices dropped remarkably amid rising long-term bond yield and receding dollar weakness. We have been constructive on the precious metal and commodity complex for a while now and remain to be so in the reflationary environment. There are reasons to believe that the commodity bullContinueContinue reading “January 2021: Silver and Equity Strategy Review”
2021 EM Equity High Conviction Calls
Download PDF: 2021_em_equity_callsDownload Poland Polish manufacturing sector and exports have both staged a V-shaped recovery despite the reintroduction of a strict lockdown across major European countries (Chart 1). As an open economy that is highly integrated with European manufacturing sector Poland has benefited from the sharp recovery of German manufacturing (Chart 2-4), which points toContinueContinue reading “2021 EM Equity High Conviction Calls”
End of Year Chart Update
Download PDF: 202012_end-of-year-chart-updateDownload With the year almost ending and asset prices have rebounded strongly, we are becoming increasingly cautious on adding position to our core portfolio holdings and prefer to stay on the sideline until the next correction, at the risk of missing further upside moves. Technical and valuation point to an overbought and overvaluedContinueContinue reading “End of Year Chart Update”
Commodity Plays, Copper and Yield, Caution on U.S. Equity
Downlaod PDF: monthly_202012Download Earlier this week we published our long-term global themes, outlining the possibility of stronger inflationary pressure and the danger it poses to corporate sector. Meanwhile, we also publish our next year outlook last month, where we argue that Chinese growth will rebound strongly and liquidity will remain plenty, buoying asset prices. WithContinueContinue reading “Commodity Plays, Copper and Yield, Caution on U.S. Equity”
South Africa: The Good, The Bad, And The Ugly
Download PDF: southafrica_full202011Download South African government released its medium-term budget plan late last October, highlighting the steps it will take to bring the country’s spiraling public debt under control. South African assets had been bombed out this year, which offers attractive investment opportunities from a tactical point of view. However, structural outlook remains bleak andContinueContinue reading “South Africa: The Good, The Bad, And The Ugly”
Global Themes 2021: China, U.S., and Emerging Markets
Download PDF: monthly_202011Download This year, the coronavirus and lockdown restriction enforced globally have driven the financial market at large, far outweighing the impacts from U.S.-China escalating geopolitical rivalry, war in the Caucasus, and U.S. Presidential Election. These themes are likely to continue in 2021 and already some of its effects lingered permanently, as discussed below.ContinueContinue reading “Global Themes 2021: China, U.S., and Emerging Markets”
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