Our early conviction in pro-cyclical trends keeps getting confirmed. Initially, our nowcast indicator for China signaled a positive outlook, and most notably this week, the Li Keqiang Index has experienced its strongest monthly surge since 2005.

South Korea is trading firmly in an uptrend btw, which has been our main bet in equity space since early March

It seems like South Korea is the true catch up trade (outside of Materials in US equity markets) to a reflation story out of China.

We identified China’s crossroads in this week’s EM editorial. Seems right-tail > left-tail currently. 

Chart 1: China revitalization confirmed