After the market closed in January 2022, the overall performance of A-Shares may not be satisfactory to investors. The three major stock indexes fluctuated and fell, and the growth style fell ahead. On the whole, the high valuation of popular stocks, the lower than expected incremental funds and the transmission of overseas risk factors are regarded as the reasons for the adjustment of market shocks in the beginning of the year.
However, at the current time point, institutions generally believe that the above risks have been digested, while more positive factors are converging, and the “bottom of the market” of A-Shares is close at hand.
the “steady growth” policy is gradually implemented
steady growth in core asset performance
Looking back on this week’s A-share market, some heavyweights have taken the lead in showing the momentum of stabilization.
First of all, under the general tone of “taking the lead in stability and seeking progress in stability”, the Ministry of industry and information technology, the people’s Bank of China, the Ministry of Commerce and other departments have recently revealed the policy ideas and starting points of 2022. All localities have also made clear the strength and key direction of this year’s “steady growth” policy combination, and the “steady growth” policy is expected to be implemented gradually.
In this context, the main line of “steady growth” has become the focus of funds. On the one hand, the stock prices of Listed Companies in the traditional infrastructure chain and real estate chain have a strong trend. For example, the stock prices of leading companies with a market value of 100 billion China State Construction Engineering Corporation Limited(601668) rose 4% against the trend in January, and the stock prices of China Vanke Co.Ltd(000002) , Poly Developments And Holdings Group Co.Ltd(600048) and other companies have risen since the beginning of the year.
On the other hand, the new energy under the “double carbon” goal is still a high-speed track supported by policies. The recent stock price trend of new energy core assets represented by Contemporary Amperex Technology Co.Limited(300750) has been significantly repaired. Yesterday, Contemporary Amperex Technology Co.Limited(300750) share price hit the bottom and rebounded, up more than 3%. The performance forecast disclosed overnight shows that the net profit of Contemporary Amperex Technology Co.Limited(300750) 2021 is expected to reach 14 billion yuan to 16.5 billion yuan, a year-on-year increase of 150.75% to 195.52%. Among them, the net profit of Contemporary Amperex Technology Co.Limited(300750) in the fourth quarter of last year was almost equal to the sum of the first three quarters, and the industrial prosperity was prominent.
Citic Securities Company Limited(600030) Qin Peijing’s strategy team believes that the short-term adjustment range of the A-share market has deviated from the fundamental trend supported by the policy, and the policy will once again guide funds to gather consensus. After the force of monetary policy, other relay policies are forming a joint force. In addition, the trend of stabilizing the economy by investment is obvious.
Citic Securities Company Limited(600030) it is expected that with the increasing confidence of investors in the “steady growth” policy, the main line of “steady growth” is expected to continue to heat up and market confidence will also be boosted.
marginal improvement of fund issuance
the attraction of A-Shares is still obvious
It is generally believed in the industry that the lower than expected opening seniority is the direct cause of the downturn in market performance. Among them, the issuance rhythm of public funds has attracted the most attention.
According to the data of China Industrial Securities Co.Ltd(601377) , only 27.4 billion partial equity funds were issued in the first two trading weeks of this month (as of January 14), which is far lower than the level of the same period in 2020 and 2021.
However, this phenomenon has improved marginally recently. Data show that from January 17 to 25, partial stock funds issued 61.9 billion new shares, and 89.2 billion shares have been issued since the beginning of the year, basically returning to the normal level, attracting living water to the market.
At the same time, the self purchase of funds has also increased significantly recently. In December 2021, the self purchase scale of partial stock funds reached 523 million yuan, a new high since July 2015. This week, more than 10 head public offerings successively released self purchase plans. Obviously, from the perspective of fund managers, the current market is also at the bottom.
In addition to local institutions’ optimistic market prospects with “real gold and silver”, the trend of foreign capital flowing into A-Shares has not slowed down.
Although disturbed by the adverse factors of rising US bond yields, northbound funds have still shown a net inflow since the beginning of the year, with a cumulative net purchase of 16.773 billion yuan. According to other data, the average daily net inflow of foreign capital in the A-share market reached US $413 million in the first three weeks of 2022.
Goldman Sachs, an international investment bank, recently released a report that China’s capital market is open and has a strong momentum of reform, making the A-share market more valuable for international investors. This is partly reflected in the record northward capital inflow in 2021 and the high allocation of A-Shares of global mutual funds.
“The A-share market is large, highly liquid and growing continuously, but the allocation of international investors is insufficient. We believe that A-share is a strategic investment asset category that can not be ignored for global equity investors. In 2022, we still recommend high allocation of A-share.” Goldman Sachs stressed.
the influence of external factors is relatively indirect
the A-share market is expected to “focus on me”
Since the end of last year, overseas risk factors have continued to accumulate, including the expectation of the Federal Reserve to raise interest rates, the sharp rise in the interest rate of us long-term bonds, overseas geopolitical tensions, and the sharp decline of US stocks. However, with the passage of time and the landing of relevant risk events, institutions generally said that A-Shares will return to the state of “focusing on me”.
Chen Guo, chief strategist of China Securities Co.Ltd(601066) said that the impact of external factors on A-Shares is relatively indirect. A few days ago, the Fed’s interest rate meeting did not exceed market expectations in the timing and range of interest rate increase and contraction, which has been reflected to a considerable extent by the market. Market expectations are gradually stable.
“After the landing of the Fed’s interest rate meeting, the A-share market should no longer regard external factors as the main contradiction in the next stage.” Chen Guo thinks.
Zhang Yidong, the chief analyst of overseas A-share market, said that it would not constitute more “A-share turbulence” in the global A-share market. In his opinion, China’s policy environment will enter the stage of “stabilizing the economy” in 2022, the investment clock will gradually recover, and the RMB exchange rate against the US dollar will remain stable. Therefore, A-Shares in 2022 have better allocation and cost performance.
Guotai Junan Securities Co.Ltd(601211) the macro and strategy team jointly released a report a few days ago, firmly saying that they “look at the post holiday market of A-Shares with optimism”.
Guotai Junan Securities Co.Ltd(601211) believes that the current market is gradually pricing changes in overseas liquidity expectations, the negative impact of overseas liquidity expectations is being accelerated, and the negative factors at the denominator end are accelerating convergence. Recently, investors’ short-term risk appetite has been at a low level, and the downward space is limited. In addition, from the perspective of calendar effect, it can also be observed that the market performance after the Spring Festival holiday over the years is significantly better than that before the Spring Festival holiday. Overall, the A-share market is expected to gradually pick up after the Spring Festival holiday.
