IPOX 100 U.S. (IPXO) rises for third week as U.S. equities outperform anew. Recruit (6098 JP), SG Holdings (9143 JP) propel IPOX Japan (IPJP) to strong relative week. Safe haven buying of most U.S. equities during U.S. options expiration, underpinned by strong earnings reports and stable U.S. yields, led the IPOX 100 U.S. (IPXO) to a third week of gains, adding +0.19% to +7.07% YTD, leading weak U.S. Tech (NDX: -0.42%), while lagging the broad S&P 500 (SPX: +0.59%). Here, the distribution of returns in individual portfolio holdings remained wide, with earnings-driven losses in little-weighted telecom equipment maker Casa Systems (CASA US: -20.10%) or data storage provider Dropbox (DBS US: -11.40%) more than offset by strength in the high-dividend paying IPOX heavyweights. We also note gains in brick-and-mortar retailers Ollies Bargain Outlet (OLLI: +4.34%) and Burlington Stores (BURL: +3.45%), while real estate website operators Zillow (Z US: -5.53%) and Redfin (RFIN US: -4.29%) continued to slide – despite the strong U.S. housing market. Focus abroad was on the renewed slump in China-linked stocks, amid earnings and the widening vaccine scandal pressuring the sector, including Wuxi Biologics (2269 HK: -18.51%). On the back of a surge in leading global recruitment website operator Recruit (6098 JP: +8.01%) or courier services provider SG Holdings (9143 JP: +6.82%), IPOX Japan (IPJP: -0.13%) traded relatively flat, adding +119 bps. vs. the weak TOPIX (TPX: -1.32%) and a massive +417 bps. vs. the slumping TSE Mothers (TSEMOTHSR: -4.30%).
Select IPOX-linked Investment Products Performance Update: Last week, the USD billion 1.2 IPOX 100 U.S. (IPXO)-linked First Trust U.S. Equity Opportunities ETF (FPX) rose to +7.36% YTD, while the plunge in China-linked stocks pressured its international version (FPXI) anew, dropping to -4.10% YTD. Amongst IPOX-linked actively managed funds, the Catalyst IPOX® Allocation Fund (OIPAX) rose to +9.84% YTD.
IPOX® 100 U.S. – Investing with the “FPX” ETF since 2006
|Select IPOX Indexes Returns (%)||Last Week||2017||2018 YTD|
|Exposure: Global/International (xUS) (USD) (Price)|
|IPOX Global (IPGL50)||-1.24||28.59||0.10|
|IPOX International (IPXI)*||-2.08||37.80||-5.00|
|Exposure: United States (USD) (Price)|
|IPOX U.S. Composite (IPXC)*||-0.68||33.64||7.02|
|IPOX 100 U.S. (IPXO)*||0.19||26.04||7.07|
|IPOX 30 U.S. (IPXT)||0.68||26.63||3.65|
|Exposure: Europe/Nordic Region (EUR) (Price)|
|IPOX Europe 30 (IXTE)||-1.20||19.27||2.03|
|IPOX Nordic (IPND)||-1.41||17.91||1.57|
|Exposure: Asia-Pacific/China Region (USD) (Price)|
|IPOX Asia-Pacific (IPTA)||-0.21||23.30||-0.31|
|IPOX China (CNI)||-7.95||37.67||-7.65|
|IPOX Japan (IPJP)||-0.13||N/A||N/A|
* Basis for ETPs: FPX US, FPX LN, FPXU FP, FPXI US, TCIP110 IT and CME traded e-mini IPOX® 100 U.S. Index Futures [Symbol: IPOU8].
IPO Deal-flow Review & Outlook: No U.S. IPOs expected, global IPO markets remain quiet. High profile deals line up for September stock market debut. Only three (non-China A shares and non-local India) firms debuted last week across accessible global regions, with the average (median) equally-weighted firm adding (declining by) +2.06% (-0.43%) based on the difference between the final offering price and Friday’s close. The largest IPO in Taiwanese market of the year – home and office furniture manufacturer Shane Global Holdings (8482 TT: -0.43%) – fell based on final offer on the week, while British healthcare artificial intelligence company Sensyne Health (SENS LN: +7.14%) closed with notable gains and San Jose, CA-based microcap biopharmaceutical company Aridis Pharmaceuticals (ARDS US: -0.54%) – pricing at the low of the range – closed with slight losses. The global IPO deal flow calendar remains light this week, with only Seoul-based biotech firm Biosolution (086820 KS) expected to commence trading. While deal flow is set to remain seasonally subdued beyond this week through the remainder of the month, we note a number of high-profile firms having entered the pipeline and set to go public during September. Respective firms set to pursue their IPO/New Listings on an exchange in the U.S. include global pharmaceutical company Eli Lilly’s (LLY US: +3.23%) Spin-off Elanco Animal Health (ELAN US), ‘Chinese Tesla’, electric vehicles maker NIO (NIO US) and P2P and institutional lender, Hangzhou, China-based Weidai (WEI US). In the European market, the IPO pipeline includes companies such as British luxury car maker Aston Martin and Chinese automobile company Zhejiang Geely-owned Swedish vehicle manufacturer Volvo Cars.
|Select IPOs traded (week: 08/13/2018)||Domicile|
|Aridis Pharmaceuticals Inc||United States|
|Sensyne Health Ltd||Britain|
|Shane Global Holding Inc||Taiwan|
|Select IPOs expected (week: 08/20/2018)||Domicile|
|Biosolution Co Ltd||Korea|
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