Seeking Alpha
  • Friday, April 24, 2015

  • 2:55 PM
    • Investors have rushed $13B into WisdomTree's (NASDAQ:WETF) Europe Hedged Equity ETF (NYSEARCA:HEDJ) this year, bringing AUM to $20B, and making it 2015's most popular ETF, the largest Europe ETF out there, and the largest currency-hedged ETF, according to Ned Davis Research.
    • The fund is also ahead 30% YTD - not too shabby. However, says NDR, all of the gains have come from the euro's depreciation. A strategy of buying the MSCI EMU Index (NYSEARCA:EZU) and shorting the euro would have returned 70% over the same period. In other words - amid a nice bull move in Europe - HEDJ's strategy of owning exporters, which should theoretically gain as the euro slides, hasn't worked (the fund must own mega-cap stocks deriving more than 50% of revenue from outside Europe).
    • What gives? First, Europe's exporters have been hit by exposure to struggling LatAm countries. Second, the companies in the HEDJ already hedge currency exposure, booking it as an expense. Finally, the valuation of stocks in HEDJ trade at a 52% premium to  a broad MSCI eurozone index.
    • Source: Barron's
    • Previously: WisdomTree stumbles as GMO questions value of currency-hedged ETFs (April 14)
    • Previously: WisdomTree hedged small-cap Europe ETF opens for business (March 4)
  • 12:00 PM
    • Volvo aims to produce a new series of small cars with parent Geely Holding Group (OTCPK:GELYF, OTCPK:GELYY).
    • The Swedish automaker is likely to produce the new models in Belgium and in China.
    • Sources indicate a new platform will be used for development.
    | Comment!
  • 11:01 AM
    • Continuing details on numerous corruption scandals, sluggish economic growth, and credit downgrades are garnering most of the headlines out of Brazil, but the Bovespa's 2.1% gain today has that index higher by 21% since a late-January bottom.
    • 70% gain in Petrobas over the last month and 25% for Vale lead the way. The banks are also on the move, though less subdued: Banco Santander Brasil (NYSE:BSBR) and Itau Unibanco (NYSE:ITUB) are up 13% and 16%, respectively. Banco Bradesco (NYSE:BBD) - recently the subject of a Goldman downgrade - is off 6% over the last month and 19% YTD.
    • The iShares MSCI Brazil ETF (NYSEARCA:EWZ) has lagged - its top three holdings are Itau Unibanco, Ambev (NYSE:ABEV), and Banco Bradesco. The ETF is flat YTD, though higher by 15% over the last month.
  • 7:57 AM
    • Mercedes-Benz (OTCPK:DDAIF) faces a fine of 350M renminbi ($57M) in China over allegations the automaker fixed prices on cars and parts.
    • Anti-trust regulators in China first announced the infractions against Mercedes-Benz last August.
    • Foreign automakers have heard from regulators in China with increasing regularity over the last year.
    | Comment!
  • 6:42 AM
  • 6:30 AM
    • Japan -0.83%
    • Hong Kong +0.84%.
    • China -0.47%.
    • India -1.07%.
    • London +0.31%.
    • Paris +0.42%.
    • Frankfurt +0.53%.
    | Comment!
  • 5:14 AM
    • UBS Wealth Management, the world's largest wealth manager, has trimmed its positions in U.S. and U.K. stocks, betting that eurozone shares offer the best value and growth prospects due to a combination of QE, accelerating economic growth, and strong corporate earnings.
    • The firm cut its tactical allocation to U.S. stocks to the lowest in three years at "neutral" from "overweight" while initiating an "underweight" on U.K. stocks; Eurozone shares remain at "overweight".
    | Comment!
  • 3:47 AM
    • Quickly running out of cash, Greece appeared to offer concessions on some key reforms on Friday, ahead of the Eurogroup meeting in Riga which will discuss the progress of the country's reform pledges.
    • "Our government is eager to rationalize the pension system (for example, by limiting early retirement), proceed with partial privatization of public assets... and create a fully independent tax commission," Greek Finance Minister Yanis Varoufakis announced.
    • Yesterday, Germany's Angela Merkel said everything must be done to prevent Greece from running out of money
    • ETFs: GREK
  • 2:36 AM
  • 2:19 AM
    • Just a day after clearing a Senate committee, the new Trade Promotion Authority bill has been approved by the House Ways and Means Committee, giving Congress the ability to vote yes or no on trade agreements, but without the ability to make amendments over the next five years.
    • The bill would ease passage of the Trans-Pacific Partnership, which the Obama administration is currently negotiating with Japan and 10 other nations.
    • Previously: Abe says U.S., Japan close to TPP deal (Apr. 21 2015)
  • Thursday, April 23, 2015

  • 2:30 PM
    • A casino bill in Japan could be submitted during the current parliamentary session, according to Union Gaming Research.
    • The session is scheduled to end on June 24.
    • Even if Japanese legislators are able to work out a bill this year, it will take a second action in 2016 to sort out licenses, locations, and the all-important question on whether or not local citizens will be allowed to gamble.
    • Tokyo hosts the 2020 Summer Olympics which is seen as a possible revenue bonanza for the gaming industry.
    • Related: Mohegan Sun to gamble in South Korea (April 22)
    • Potential Japan casino players: MGM Resorts (NYSE:MGM), Caesars Entertainment (NASDAQ:CZR), Wynn Resorts (NASDAQ:WYNN), Genting, Las Vegas Sands (NYSE:LVS), Melco Crown (NASDAQ:MPEL).
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  • 7:21 AM
    • Altria (NYSE:MO) reports cigarette volume rose 1.6% Y/Y in Q1.
    • Marlboro volume was up 1.2%, while the discount category saw growth of 8.6%.
    • Cigar volume rose 10.2% to 302M sticks.
    • Cigarette market share +40 bps to 51.1%.
    • Cigar market share -50 bps to 27.4%.
    • Operating income increased 7.4% to $1.923B as sales rose faster than costs.
    • Guidance: Altria sees 2015 EPS of $2.75-$2.80.
    • Previously: Altria beats by $0.01, beats on revenue
    • MO -1.48% premarket.
  • 6:45 AM
    • Japan +0.27%
    • Hong Kong -0.38%.
    • China +0.36%.
    • India -0.56%.
    • London +0.06%.
    • Paris -0.88%.
    • Frankfurt -1.06%.
    | Comment!
  • 1:41 AM
    • Manufacturing sector witnessed decline in operating conditions for the successive month with PMI hitting one year low at 49.2 missing estimate of 49.6, from 49.6 in Mar.
    • Manufacturing output index signaled marginal increase to 50.4 from 51.3 in Mar.
    • New orders declined at a faster pace due to weak demand led by strong deflationary pressures.
    • Output and Input prices fell at faster pace, employment recorded decline for consecutive eighteenth month.
    • Demand from overseas improved led to increase in new export orders for the first time in three months.
    | Comment!
  • 1:12 AM
    • Japan Flash manufacturing PMI contracted to 49.7 missing estimate of 50.8, down from 50.3 in Mar.
    • The Manufacturing output declined to 49.7 for the first time since July 2014 from 52.0 in Mar.
    • New orders and backlogs of work declined at faster pace, employment registered marginal growth.
    • Price competitiveness improved due to favorable yen/dollar rate as new export orders increased.
    | Comment!
  • Wednesday, April 22, 2015

  • 3:18 PM
    • Questioning the sustainability of the dollar (UUP, UDN) bull market and believing the greenback to be overvalued across the board, Research Affiliates' Michele Mazzoleni suggests now might not be a bad time for U.S. investors to take advantage by picking up relatively cheap overseas assets.
    • People are buying dollars, he says, in anticipation of higher U.S. rates, but they're no certainty, and some Fed officials are appear to be having misgivings about tightening policy too soon, in part due to the strong dollar.
    • As for valuation, the dollar is more than 10% above its long-run value as predicted by Purchasing Power Parity theory. That's fine if rates are on the rise, but maybe unsustainable if not.
    • Previously: Fed's Rosengren talks rate hike delay (April 22)
  • 2:29 PM
    • 22% of hybrid and electric car owners making a trade-in this year opted to go for a SUV, according to data from
    • The mark stood at 18.8% a year ago and 11.9% three years ago.
    • The rate at which hybrid and EV car owners bought another green car fell below 50%.
    • connects the dots to conclude that the level of gas prices in the U.S. was a primary factor in the trade-in trend.
    • The break-even point for higher-priced EVs lengthens as gas prices fall.
    • Automobile industry analysts think the trend could snap back just as quick with an energy market shock.
    • YTD U.S. plug-in sales are up ~2.9%.
    • Related stocks: OTCPK:NSANY, TM, HMC, GM, F, TSLA.
  • 2:13 PM
    • Lufthansa (OTCPK:DLAKF, OTCQX:DLAKY) has resumed talks with a union representing pilots.
    • Negotiations between the two groups broke off following the Germanwings crash last month.
    • The major rift between the company and pilots is over early retirement benefits.
    | 1 Comment
  • 1:43 PM
    • Microblogging platform Weibo (WB +11.1%) is off to the races after the Shanghai exchange rose 2.6% overnight (continuing a massive bull run), as are online real estate plays SouFun (SFUN +9.1%) and Leju (LEJU +6.9%). CDN owner ChinaCache (previous) is also posting big gains.
    • Bullish comments from Citi and HSBC about Chinese real estate could be giving a lift to SouFun/Leju. Citi reports sales in tier 1/2 cities are "picking up strongly post recent aggressive policy loosening," and that home prices rose in March.
    • Following a U.S. trip, HSBC reports long-time Chinese real estate bears have become bullish. "Investors are more bullish than at any other time over the last few years on China’s real estate sector. While their more constructive outlook is partly fueled by the broader market rally amid liquidity inflows from the mainland, investors are also coming to the realization that government policies both macro and property-specific are steering the sector towards a potentially faster-than-expected physical market recovery."
    • HSBC adds investors were inquiring about "mid cap and higher beta stocks," rather than just large-cap "safe havens," as well as about "laggards in the sector." SouFun and Leju fit that description.
    • Separately, Leju filed its annual report after the close yesterday.
    | 1 Comment
  • 12:52 PM
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