Smartkarma | Intelligent Investing

US: Manufacturing Boom!

insights@smartkarma.com (Richard Iley) — Mon, 04 Sep 2017 18:47:29 +0800

While markets have focused on the slight miss in the headline number, the real message of the August labour market report was that the manufacturing sector is booming. Manufacturing payrolls jumped by a seasonally-adjusted +36k in August; their largest monthly gain in 4 years. Moreover, the 3-month gain in manufacturing jobs is a now a punchy +83k; the strongest since 2012Q1. The BLS also provides a diffusion index for manufacturing employment which measures the breadth of jobs...(continued)

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Emerging Asia: Review and Outlook (Part 1 of 6)

insights@smartkarma.com (John-Paul Smith) — Mon, 04 Sep 2017 16:48:48 +0800

The renewed surge in emerging market equities appears increasingly at odds with the underlying fundamentals in a manner which is starting to be reminiscent of 2007, or in the case of China the aftermath of the great monetary stimulus of 2009-10. There have been five main drivers; dollar weakness emanating from the near-paralysis of the Trump administration; global flows into technology stocks which have benefited the three emerging markets in North Asia; the renewed fall in the...(continued)

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What Tech Companies Want for Their Offices

insights@smartkarma.com (Louisiana Yip) — Mon, 04 Sep 2017 15:04:40 +0800

By Christopher Clausen / Office / Asia Pacific The technology sector is one of the most important occupier categories in Asia Pacific. For example, the region is now home to seven of the 22 global fintech unicorns—startups valued at more than US$1 billion. The e-commerce industry has been a major contributor to office leasing demand and is projected to grow substantially in the near term. Over the last few years, we’ve seen tech firms moving into Grade A office space in prime...(continued)

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Infosys: Promoters’ Participation in Buy Back Is Bad, Are They Concerned on Business Sustainability?

insights@smartkarma.com (Pankaj Sharma) — Mon, 04 Sep 2017 14:45:50 +0800

Promoters will participate in the share buyback Infosys Ltd (INFO IN) promoters will participate in the share buyback which the company had announced after the earlier CEO Vishal Sikka's departure. Please refer to Infosys CEO Sikka Resigns, Will A Professional Chief Executive Be Always at the Mercy of Founders? and Infosys: Buy Back Announcement Is Positive but It Is Unlikely to Change the Investor Sentiment. Infosys has informed the exchanges that the promoters may tender up to a...(continued)

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South Korea: Deeper Structural Weaknesses Reflect Economic Malaise

insights@smartkarma.com (Jason Tan) — Mon, 04 Sep 2017 14:35:37 +0800

Expansionary budget focused on job creation and social welfare: There will be another boost to Moon’s income-led growth mantra with the record-high KRW429tr 2018 budget, which will focus on job creation and social policies, while reducing spending on culture, sports, and infrastructure. There is also focus on innovation to build new growth drivers. No movement in already accommodative policy rate: The Bank of Korea (BOK) announced that the policy rate will be staying put at...(continued)

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India: Cabinet Reshuffle Focused on Winning 2019 Election

insights@smartkarma.com (Manu Bhaskaran) — Mon, 04 Sep 2017 14:33:36 +0800

Prime Minister Modi reshuffled his cabinet: There was a governance element in the reshuffle as well as raw political calculation: More experienced technocrats: Modi appointed tested and high performing bureaucrats as junior ministers including Alphons Kannanthanam (who as commissioner of the Delhi Development Authority had made a name for himself in taking on vested interests to clear 15,000 illegal structures) and Satya Pal Singh, who had been the police chief in Mumbai. R.K....(continued)

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Yaskawa Visit: Smartphones/Pricing Power Drive OPM Expansion, 2H Overshoot if IPhone 8 Delivers?

insights@smartkarma.com (Mio Kato, CFA) — Mon, 04 Sep 2017 14:24:03 +0800

We visited Yaskawa Electric Corp (6506 JP) this morning to discuss its excellent first quarter results and gain further insight on the sustainability of profitability improvement. We came away with confirmation of the general consensus among machinery/factory automation companies that current demand from China is heavily iPhone driven and that 1Q is likely to be a short term peak. However, we also found many of Yaskawa's medium term efforts to be starting to generate positive...(continued)

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Deconstructing Sydney’s Rental Growth Story

insights@smartkarma.com (Louisiana Yip) — Mon, 04 Sep 2017 12:59:45 +0800

By Joanne Henderson / Office / Australia The Sydney CBD office market currently holds the title: ‘strongest rental growth in the world for 2017’ of all office markets monitored globally. However, with notoriety comes scrutiny, so what happens if we peel back the numbers underpinning Sydney’s rental growth story? To set the scene, the prime grade office market in Australia consists of two sub-sectors: Premium and Grade A. If we delve into the numbers, what can we learn about the...(continued)

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35%-50% Upside for Gold Shares

insights@smartkarma.com (Thomas Schroeder) — Mon, 04 Sep 2017 12:03:19 +0800

Gold clearing 1,300 medium term resistance opens the way for a new and higher trading range. Gold will continue to find underlying support from geopolitical risk and more importantly if the DXY breaks below the all important 92 support. Global growth expectations will play a role in how gold trades above the key 1,300 support (old resistance). When gold rises by one dollar gold mining shares are geared to rise by 3 dollars typically. Now if gold rises moderately as global equities...(continued)

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US Economy: Despite Payrolls, Economy Is Strong Enough for Fed Normalisation

insights@smartkarma.com (Jason Tan) — Mon, 04 Sep 2017 10:56:16 +0800

GDP growth strongest since 2015 on firm domestic demand: GDP growth increased 3% in 2Q17, up from 1.2% in 1Q17 and the highest since 2015. Consumer spending was a key source of growth, accounting for about three-quarters of GDP growth. High frequency data point to continued vigour: The ISM manufacturing index surged from 56.3 in July to 58.8 in August, with lead indicators such as new orders remaining very strong. Both the Conference Board Consumer Confidence index and the...(continued)

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