There was one model change this week.
Chinese equities, and international equities as whole, as discussed here, improved broadly over the course of the past week. The improvement in Chinese equities was driven mainly by a cooling of trade talks between the United States and China, as the US Treasury Secretary, Commerce Secretary, and US Trade Representative all met with Vice Premier He Lifeng to discuss China’s export controls on rare earth elements and US export controls on semiconductors. On the economic front, CPI in China fell slightly month-over-month by -0.2%, driven mainly by a -1.7% drop in energy prices, which accounted for 70% of the CPI decline (source: chinalastnight).
Although Chinese equities improved over the past week, other international equities improved by a higher margin. This ultimately led the KraneShares Tactical Emerging Markets Model (KRANETACTEM.TR) to sell the KraneShares Bosera MSCI China A 50 Connect Index ETF (KBA) and purchase the KraneShares MSCI Emerging Markets Ex China Index (KEMX).
In the Asset Class Group Score Page (ACGS), China moved from the 59th group to the 47th, showcasing the ongoing technical improvement of Chinese securities. One name that stands out is the KraneShares CSI China Internet ETF (KWEB). After reversing into a column of Xs last week, KWEB now stands one box away from breaking a double top at $35 and moving back into a positive trend. Year-to-date, the fund has a performance of almost 20%. Additionally, the fund has a yield of over 3%. Initial support can be seen at $32.50, with additional support at $30.
