Tactical Europe Portfolio :
performance (alpha) : +4.3% versus Stoxx600NR
Megatrend Europe Portfolio :
performance (alpha) : -3% versus Stoxx600NR
Core US Portfolio :
performance (alpha) : -0.3% versus S&P500
Trading signal split (stocks only)
- Enter Long : 55.8% of stocks with an « enter long » signal in process
- Enter short : 0.5% of stocks with an « enter short » signal in process
- No signal: 43.7% of stocks of which last signal is an « Exit Long » or « Exit Short »
US: Exposure to US Equity markets 100% / Cash 0% (unchanged)
Europe: Exposure to European Equity markets 100% / Cash 0% (unchanged)
Equity markets ended flat in yesterday's trading session, but meantime some significant rotations are in process again. Banks, Oils and Basic Resources continued to strenghten amid optimism that the worse of the health crisis is now behind us, with falling new Covid-19 cases around the world, and acceleration of the vaccination rollout in most developped countries. This also lead to a beginning of profit taking phase in some Technology and Solar energy stocks that are sensible to fast rising long term rates (10Y US rates now at 1.3%) and Biotechnologies. The "reflation trade" is therefore on acceleration mode, led by commodities and consequently by Mining companies, and spreading to financials that benefit from the steepening rate curve. It will be interesting to monitor closely the tourism sector including Hotels and Transport (mainly Cruise and Airlines), that looks closer to a bullish reversal, unlike the property sector which is weakening again. This move, if confirmed may trigger a larger rotation between Growth and Value stocks but should not be anticipated for the moment. The overall (bullish) market situation remains unchanged in both Europe and the US.
Buy signal on Airbus (AIR-FR)
Airbus is a €72 Bn market cap and the leader in Europe and No. 2 worldwide in the aeronautics, space and defense industry. Revenues split between 3 main segments :
1/commercial aircraft (77% of sales), Airbus is world leader in aircraft with more than 100 seats;
2/defense and aerospace systems (15%) including military aircraft (particularly transport, maritime surveillance, anti-submarine fighter and air-to-air refueling aircraft), space equipment (orbital launchers, observation satellites and communications, turboprop aircraft, etc.), defense and security systems (missile systems, electronic and telecommunications systems, etc.). Airbus SE also offers aircraft training and maintenance services;
3/civil and military helicopters (8%).
Airbus posted a net loss of €1.1 bn in 2020, but a profit of €1.6 bn in Q4, nearly 60% above market expectations. At the end of September, Airbus had delivered only 341 planes and had 135 aircraft manufactured but not shipped to their customers due to the health crisis.In addition, the company managed to register 268 net orders in 2020, increasing its order book to 7,184 commercial aircraft, what secures the company’s revenue over a decade.
Among other positive, a pause in the « subsidies war » concerning Boeing and Airbus could be on the Agenda between the US and France.
Short term catalyst : Reopening of the world economy, pause in "tarifs war".
This signal looks consistent with the Aerospace & Defence sector in Major Bullish Trend.