Safe Haven Flows Continue

STATE OF THE MARKETS

Safe haven flows continue. Global equities ran into the green territories on Tuesday but flows into US bonds, Dollar, Yen and Swiss were noted as markets prepare for US employment figures. S&P (+0.03%), Dow (+0.03), and FTSE UK (+0.21%) climbed higher while US 10Y inched lower from 1.482% on Monday to 1.475% on Tuesday; signaling cautious markets as Dollar (DXY) continue to advance while gold decline.

Crude rebounded to settle around $72.98/bl as hope on increased demand continued but weighed by selling pressure from sentiments of new covid variants that could crippled global economy. Gold finally broke down and tested the $1,750/oz level as Dollar (DXY) strength continued into the 92 mark.

Safe haven flows continue to dominate the FX space as Yen and Dollar were seen leading all accounts horizons, ahead of Swiss; except in the medium term where Kiwi and Euro were more favored that the Swiss. The comdolls were seen on offers across the board, while Sterling was all over the place. Euro remains well bid, except in the long term accounts, where Sterling regained demand.

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TOP 5 BLOCK ORDERS

OUR PICK – VIPSHOP (VIPS, NYSE)

Among the Amazons of China. When Amazon threw the towel in China after 15 years of trying and only managed to secure less than 1% of the Chinese e-commerce market, many other companies have sprung up to take the challenge. Among them is VIPSHOP. With only 12.7 times trailing PE and 11.0 forward PE, this stock is a definite discount in its industry that trades on average of 70.8 times trailing PE and 438.8 forward PE. S&P GMI sees 32% upside in fair value, with high quality of growth and financial health. Recent sell-off is a perfect long term buying opportunity in our view. We would not hesitate to accumulate without stop loss in our cash account.

Note: If you require fundamental reports for this stock, please contact your account manager or support@mfmsecurities.com for a copy.

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