AKG weekly charts - Issue #108
This newsletter is a weekly selection of 10 charts hand-picked across the internet which pertains to our investment strategy and bring an updated insight and perspective.
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[1] Active managers had less than 20% exposure to equities last October when the S&P 500 was at 3,500. Today their equity exposure has jumped above 100% (leveraged long) with the S&P 500 above 4,500. This is the highest exposure since November 2021.
[2] Investors have their biggest underweight in commodities since May '20 and the chart turned up. Will history repeat itself? Enough hints in the inventory and capex data to take a contrarian bet
[3] The Top 20 Wealth Creators among 28,000+ US-listed companies since 1926 and their age as public data. Michael Mauboussin published a paper last week outlining this (see here).
[4] German economy is the only one among the big ones that is below pre-Corona level. Q2 data showed no growth after a recession. Enduring industrial weakness is overshadowing outlook. Likley to continue till rate cycle remains elevated.
[5] Wheat prices keep rising after Ukraine warns on Russia ships in a tit-for-tat response to a similar warning from Moscow. Both Ukraine & Russia are major grain exporters & Ukraine’s exports have been severely restricted by war. Black Sea ports are a major exit point to global markets. (Source : BBG)
[6] As EV and Hydrogen led vehicles take prominence over coming decade, gasoline demand will drop steadily though pace would depend on various economic factors. Green energy theme should dominate portfolios across next few years.
[7] Europe cyclical stocks are outperforming defensives like FMCG, retailers etc but the manfuacturing outlook is diminishing in light of recession like conditions, high youth unemployment and rate tightening cycle. Exporters in India likely to underperform in next 3-6 months.
[8] Surprisingly, tech spends expensed in the P&L did not show significant signs of stress for many BFS firms, large and mid-size. YoY increase in technology related expense was in double digits for Citi and Wells Fargo and in high single digits for Morgan Stanley, GS and BofA. Growth accelerated for Citi and Wells Fargo and decelerated for Morgan Stanley, GS and BofA. Tech spends declined for JPM likely due to insourcing, but not a new challenge.
[9] Southwest monsoon rainfall has moved into surplus zone at the all-India level. Agrochemicals to make a comeback in H2FY24? (Listen views from 7:00 here)
[10] India’s exports mix have changed a lot in the last decade. Will it be different in the next decade?
Disclaimer:
This newsletter is for information and educational purposes only. In this material, Amit Kumar Gupta (SEBI registered Research Analyst, INH100009327) has used information that is publicly available and is believed to be from reliable sources. While utmost care has been exercised, the author does not warrant the completeness or accuracy of the information and disclaims all liabilities, losses and damages arising out of the use of this information. Readers, before acting on any information herein should make their own investigation & seek appropriate professional advice. Any sector(s)/ stock(s)/ issuer(s) mentioned do not constitute any recommendation and the RA may or may not have any future or existing position in these. All opinions/ figures/ charts/ graphs are as on date of publishing (or as at mentioned date) and are subject to change without notice. Any logos used may be trademarks™ or registered® trademarks of their respective holders, our usage does not imply any affiliation with or endorsement by them. Past performance on charts may or may not be sustained in the future and should not be used as a basis for comparison to infer any investment ideas