Taiyo Nippon Sanso (TNSC.JP; 4091 JP) – $9.1B market cap – Technicals: The stock was up ~9% on May 12 and broke out of a stage-one, 37-
week cup-with-handle base on ~5x the average volume. It is trading 14% from the pivot price of ¥2,533 and is extended here. Look for a low volume
pullback to its 10-DMA (¥2,705; -7%) or the pivot range for an alternative entry.
Symbol: VGA.IN
Global Laggards
Highlighted Charts
U.S.: Huntsman Corp (HUN), Fluor Corp (FLR), Unifirst Corp (UNF), Ford (F), Xpel (XPEL), General Motors (GM), Paramount (PARA), Fox Corporation (FOXA), Vail Resorts (MTN), YETI Holdings (YETI), Brown Forman Corp (BFB), A P A Corp (APA), Magnolia O&G Corp Cl A (MGY), BOK Financial Corp (BOKF), First Commonwealth (FCF), Unitedhealth (UNH), Grocery Outlet (GO), Ubiquiti Inc (UI), XPO Logistics (XPO).
Developed: Asahi Kasei (AC@N.JP, 3407 JP), Pearson (PSON.GB; PSON LN), Entain (ENT.GB; ENT LN), Toto (TOTO.JP; 5332 JP), Calbee(CALB.JP; 2229JP), Fukuoka Financial Group (FUKU.JP), Seiko Epson (SEEP.JP; 6724 JP).
Emerging: Kt&G(KTB.KR; 033780 KS), Firstrand (FSRJ.ZA; FSR SJ), Avenue Supermarts (AS.IN; DMART IN), Interglobe Aviation (VGA.IN, INDIGO:IN).
Global Laggards
Highlighted Charts
U.S.: Axalta Coating Systems (AXTA), Boeing (BA), Tata Motors (TTM), Skechers U S A Cl A (SKX), Hilton Grand Vacations (HGV), Masco Corp (MAS), Anheuser Busch Inbev (BUD), C M E Group (CME), Pinnacle Financial (PNFP), Truist Financial Corp (TFC), Texas Capital Bancshares (TCBI), Marketaxess Holdings (MKTX), Masimo Corp (MASI), Lowe’s Companies (LOW), Copart (CPRT), Seagate Technology (STX), Dynatrace (DT), Concentrix Corporation (CNXC), Black Knight (BKI), Alphabet Cl A (GOOGL), X P O Logistics (XPO).
Developed: Stora Enso R (EGR.FI, STERV FH), West Fraser Timber (WFG.CA; WFG CN), Daiwa House Industry (DH@N.JP; 1925 JP), Sega Sammy Holdings (SESA.JP; 6460 JP), Idemitsu Kosan (IDKO.JP; 5019 JP), Ampol (ALD.AU; ALD AU), Metcash (MTS.AU; MTS AU), Cathay Pacific Airways (CATH.HK; 293 HK).
Emerging: Sasol (SOLJ.ZA, SOL SA), The Foschini Group (TFGJ.ZA; TFG SJ), Interglobe Aviation (VGA.IN).
APAC Market Update
Key points:
- We are downgrading India to a Downtrend from an Uptrend Under Pressure as coronavirus fears escalate. We recommend raising cash if possible or maintaining a defensive approach.
- Including today’s market condition changes, 11 of 13 APAC markets are in a Downtrend.
- Earlier this week, we shifted Australia, Hong Kong, Japan, South Korea, Singapore, and Taiwan to a Downtrend. Today, we shifted China to an Uptrend Under Pressure from a Confirmed Uptrend as the CSI 300 declined below its 50- and 100-DMA on above average volume.
- We are bearish on APAC markets. We recommend avoiding buys if possible until a follow-through day occurs.
- Vulnerable ideas on our list include HDFC Bank ( HFC.IN ) and HDFC ( HDF.IN ). Reduce positions.
- Ideas with RS near highs include Asian Paints ( API.IN ), Pidilite ( PID.IN ), Dabur ( DAB.IN ), Unilever ( HDL.IN ), and Avenue Supermarts ( AS.IN ). Continue to hold.
Global Laggards
Highlighted Charts
U.S.: Ball Corp ( BLL ), World Wrestling Entertainment ( WWE ), Coca-Cola European Partners ( CCEP ), UGI Corp Holdings ( UGI ), Empire State Rlt Tr ( ESRT ), Glaukos ( GKOS ), eBay ( EBAY ), Belden ( BDC ), Blackbaud ( BLKB ).
Developed: Incitec Pivot ( IPL.AU; IPL AU ), Informa ( INF.GB; INF: LN ), Ajinomoto ( AJ@N.JP ), Link REIT ( LREI.HK; 823 HK ), Peptidream ( PETI.JP; 4587:JP ), Tesco ( TSCO.GB; TSCO LN ), Morrison ( MRW.GB; MRW LN ), Capgemini ( CAP.FR; CAP FP ).
Emerging: Bidvest Group ( BVTJ.ZA ), S-Oil ( SSO.KR; 010950 KS ), Woolworths (WHLJ.ZA; WHL SJ ), Intouch Holdings ( SHNW.TH; INTUCH: TB ), Interglobe Aviation ( VGA.IN; INDIGO IN ).
Global Focus Emerging
The CSI 300 gained 1.43% for the week on higher volume. The market remains in a Confirmed Uptrend with four distribution days. The block-chain stimuli did not last long and market sentiment was still impacted by increased downward pressure on the economy. China’s manufacturing PMI declined to 49.3% in October, the sixth straight month that factory activities shrank. As Q3 earnings season ends, we expect market volatility to subside in the near term. The decreasing distribution day count has also boosted our conviction. We are cautiously optimistic and expect the CSI 300 to continue trading sideways above its 50-DMA, which serves as strong support. We look for the next resistance at previous highs of ~3,980. Investors are advised to stay patient and focus on ideas that have recently broken out with strong fundamentals.
Won Global View
The U.S. market remains in a Rally Attempt.The S&P 500 is now testing all-time highs after clearing above September high resistance Friday. The Nasdaq also cleared above near-term resistance but remains ~1% below all-time highs. We will upgrade to a Confirmed Uptrend should indices break out in the coming days. Though action has been resilient over the last few weeks, volume has been low and breakouts among quality ideas remains limited. We would like to see a multitude of breakouts if and when indices make new highs to gain conviction that a new sustainable trend higher is developing. 32% of S&P 500 stocks report earnings this week.
Market View
U.S. Market
The U.S. market remains in a Rally Attempt. The S&P 500 is now testing all-time highs after clearing above September high resistance Friday. The Nasdaq also cleared above near-term resistance but remains ~1% below alltime highs. We will upgrade to a Confirmed Uptrend should indices break out in the coming days. Though action has been resilient over the last few weeks, volume has been low and breakouts among quality ideas remains limited. We would like to see a multitude of breakouts if and when indices make new highs to gain conviction that a new sustainable trend higher is developing. 32% of S&P 500 stocks report earnings next week.
Won Global View
The U.S. market remains in a Rally Attempt.The S&P 500 and Nasdaq traded higher for a second straight session but remain rangebound and below September high resistance. Support is at the rising 21- and 50-DMA.
Global Focus Emerging
The CSI 300 rose 0.7% for the week on lower volume and remains in a Confirmed Uptrend with six distribution days. The market is struggling and risk preference remains low. As Sino-U.S. trade tensions ease and the market gradually reaches a consensus about economic slowdown, Q3 earnings have come into focus. Ideas that reported stronger-than-expected earnings generally outperformed its index or sector, such as Focus List name Jiangsu Hengrui Medicine (JHM.CN, 600276.CH) and Luxshare Precision Industry (SLP.CN, 002475.CH), not on our Focus List. As the market enters the final earnings week, we advise focusing on individual ideas with strong earnings performance and less on index direction. We see the CSI 300’s next immediate support at the 50-DMA with strong resistance at ~3,980. With the important party meeting next week, we will watch for any favorable signals. Investors are advised to stay patient.
