EWY rips 7.5% off a flat PMI, and Super RIGI finally clears committee
One analyst's qualitative review. Not backtested alpha. Not trade advice.
What I'm watching
- EWY $179.74, 1m +10.03%, DD -18.0%, 52w-pos 73.6%: up from Aug 12's $167.24 / DD -23.7%, a roughly 7.5% price move in a handful of sessions. Korea PMI is unchanged at 46.3, still contractionary, rising trend unchanged.
- Argentina Super RIGI: the Senate committee plenary (Presupuesto y Hacienda, Economia Nacional, Legislacion General) finally opened debate Aug 5 and resumed Aug 12, with the ruling bloc targeting a floor vote before end of August.
- EWZ $33.93, 1m -3.96%, DD -17.92%, 52w-pos 51.1%: essentially flat versus Aug 13's -18.09%, the four-reading crack has paused rather than reversed.
- DXY 99.636 (flat), VIX 14.25: regime still "cautious," unremarkable. ACWI and SPY both sit near 52-week highs (99.4% and 99.0% of range).
- No Saturday synthesis ran yesterday.
docs/picks/LATEST.mdis still dated 2026-05-02 (week 2026-18), now 15 weeks stale, the third consecutive catch-up entry to flag this unresolved.
What changed / what matters
EWY is the number that matters most this week. Aug 12's entry called it "stay an avoid" specifically because the price recovery up to that point was a base-effect artifact, the trailing 1-month return improved only because the worst crash days were rolling out of the window while drawdown kept deepening. That distinction no longer holds. Drawdown itself improved almost 6 points in a few sessions, a genuine price move, not a rolling-window illusion. I checked the IPTM action index through Aug 16 and found nothing Korea- or chip-specific in the window, and Korea's PMI is byte-identical to the Aug 12 read at 46.3. This is now the second straight cycle where Korean equities move hard with zero confirming fundamental print, which argues the market has stopped waiting for the PMI to confirm and started pricing the recovery on its own. That does not make the avoid call wrong, but it does mean Wednesday's tech-ai entry needs to actively re-underwrite it rather than carry it forward on autopilot.
Argentina is the one real resolution to a standing question. The Aug 10 entry flagged seven weeks of Senate silence on Super RIGI as itself informative, the provincial blocs extracting concessions before committing. That silence broke: three separate committees opened joint debate Aug 5 and continued Aug 12, and the ruling bloc is now working a three-week dictamen timeline aimed at passage before Aug 26. This is a live catalyst window for the first time since the Jun 24 House vote, and it should lead tomorrow's reform-momentum entry rather than repeat the wait-and-see framing.
EWZ's crack, downgraded to avoid on Aug 13 after four straight readings of widening drawdown, held flat this week rather than continuing to widen or healing. Not a reversal, worth another read before changing the call either way.
Candidate picks within this theme
Sunday does not rank; carrying the week forward with revisions:
- EWY (Korea) - still technically an avoid per Aug 12's PMI-first framework, but flag for active re-underwriting; a 7.5% move on an unchanged 46.3 PMI is too large to wave through as noise a second time.
- ARGT (Argentina) - hold, raise watch priority; the Senate logjam broke and Aug 26 is now a real date to track, not a hypothetical.
- EWZ (Brazil) - hold avoid; the crack paused, not healed.
- EWJ (Japan) - hold top conviction; PMI still 48.5 sub-50, the Aug 13 caution about chasing a 52-week high on a contracting survey stands unresolved.
- INDA (India) - continue full pace; unaffected by any of this week's flags.
What I'd revise if I saw
EWY extending this rally into a second week with PMI still under 50 would mean the market has fully decoupled from the fundamentals thesis, converting this from a flag into an outright reversal of the avoid call. Super RIGI missing its self-imposed Aug 26 target would restart the same wait-and-see loop from Jul 20 through Aug 10.
Cross-references
- Previous entry (this theme):
docs/thinking/2026-08-09-sunday-catchup-ewy-gives-back-half-its-bounce-rotation-resumes.md - EWY avoid call being revised:
docs/thinking/2026-08-12-tech-ai-taiwan-pmi-confirms-korea-pmi-still-says-no.md - EWZ avoid downgrade:
docs/thinking/2026-08-13-fx-policy-ewj-completes-the-round-trip-ewz-keeps-cracking.md - Argentina Senate wait, now resolved:
docs/thinking/2026-08-10-reform-momentum-greece-surplus-argentina-senate-still-waiting.md - Stale synthesis:
docs/picks/LATEST.md(dated 2026-05-02, week 2026-18) - Super RIGI committee debate: Infobae, 2026-07-29, hoydia.com.ar, 2026-08-12
- Data:
/api/country/KR,/api/country/AR,/api/country/BR,.cache/picks/etf-stats.json,.cache/iptm/action-index.json