During the long Spring Festival holiday, daily gossip is inseparable from the Spring Festival Gala and the national football team. At the beginning of the new year, the national football team lost 1:3 to Vietnam, and there was a lot of sadness on the Internet. Some investors said that it is not uncommon. They said that the increase of Vietnam's stock market and A-Shares in the past five years was 6:1 Although the A-share didn't open the door, it is still the most tense in the hearts of investors.
When the A-share market was closed, the peripheral stock market became the wind vane, and the US stock market walked out of four consecutive positive days in the days when the A-share market was closed.
Before the lunar new year, affected by the tightening expectations of the Federal Reserve, US stocks have entered a continuous adjustment period since January 2022, and A-Shares have also been affected. Now, US stocks have risen continuously in the lunar new year. Some netizens said, "did A-Shares fall in vain?" The continuous rise of US stocks and the repair of major markets have made investors unable to sit still during the holiday. They began to discuss how US stocks will go next and whether A-Shares can rebound after the holiday?
US stocks achieve four consecutive positive
In January 2022, the Dow fell by 3.32%; NASDAQ fell by 8.89% and the NASDAQ dominated by technology stocks gave its worst performance since March 2020; The S & P 500 fell 5.26%, second only to March 2020 and the worst January since 2009.
The turning point took place on the last day of January. On the same day, the three major US stock indexes rebounded and rose continuously in the first two trading days of February.
On January 28, US stocks rose in late trading, with the Dow Jones index up 1.65%, the NASDAQ up 3.13% and the S & P 500 up 2.43%.
January 31 saw the biggest increase, with the NASDAQ up 3.41%, the Dow up 1.17% and the S & P 500 up 1.89%.
On February 1, the Dow Jones index rose 0.78%, the S & P 500 index rose 0.69% and the Nasdaq composite index rose 0.75%. Chinese concept stocks generally rose. Among the popular Chinese concept stocks, iqiyi rose 11.03%, BiliBili rose 1.70%, Alibaba rose 1.14%, baidu rose 0.85%, JD rose 0.27% and Weibo rose 0.17%.
On February 2, the S & P 500 index rose 0.94%, the NASDAQ index rose 0.50% and the Dow Jones index rose 0.63%. Among them, Google rose 7.52%, Microsoft rose 1.52%, Qualcomm rose 6.25%, amd rose 5.12% and NVIDIA rose 2.45%.
US stocks rebounded, and the two factions held their own views
In the face of the fourth consecutive positive of US stocks, some analysts believe that the tough measures of the Federal Reserve dominated the market in January. Until the earnings season, the market finally paid attention to the company's performance, resulting in more optimism.
Chris zaccarelli, chief investment officer of independent advisor alliance, said: "The current economic situation is relatively good, GDP growth is much higher than normal, the job market is strong, and consumer and corporate balance sheets are strong. However, the Fed's interest rate hike and balance sheet reduction have great resistance to the market. I think investors are trying to determine what is the appropriate level to buy on bargain hunting, but at the same time, they should also ensure that they are prepared for possible fluctuations in the future. ”
Therefore, Chris zaccarelli said that at present, he is more inclined to relocate to high-quality and profitable companies and find opportunities in industries such as finance and energy.
However, there are different views in the market, such as bridge water fund. In its 2022 outlook, Qiao Shui pointed out: "the market is expecting inflation to steadily fall back to the low inflation level of previous decades, believing that this will happen naturally without radical policy action by the central bank. We believe that the evolution of the future situation will conflict with the current expectations."
Qiao Shui said that the large amount of funds and credit injected during the epidemic has now produced a self strengthening cycle of high nominal expenditure and income growth. This growth trend is unlikely to cool down if monetary policy is not tightened substantially.
For investors, compared with the past 40 years, there are two unique risks: first, the risk that the asset value will decline in real value due to the continuous rise of inflation. Second, the Fed's policy further lags behind the development of inflation and has to actively catch up with risks. In a very short period of time, policy easing will tend to have a positive impact according to the idea of medium-term transition. However, too much policy delay may excessively prolong these measures, reduce the yield and extend the period, which will greatly increase the long-term risk of catching up after falling behind.
The optimistic degree of bridge water fund on the financial assets of developed countries is "significantly reduced". In contrast, as the Chinese government introduced policies to stimulate the economy, it found Chinese assets more attractive.
Goldman Sachs also holds the same view.
Goldman Sachs Scott Rubner summarized the stock market since the beginning of the year in his latest "tactical capital flow" report, saying that the current market consensus is still bearish. Market sentiment will not change until the stock market can continue to rise during the day and will not turn down at the close.
At the same time, he believes that the market has not met the conditions from "red light" to "green light", because the first trading week in February coincides with the Chinese Lunar New Year, resulting in extremely low liquidity. The trading mode of selling the recent rebound still exists, and the end of January and the first trading day in February are usually key inflection points.
no "good start", A-Shares experienced "bad January"
On one side, A-share investors "sighed and sighed". Seeing the sharp rise of U.S. stocks during the rest of the market, they scolded each other for "not talking about martial ethics"; On one side are US funds that prefer Chinese assets. Both sides stick to their own words, which seems to have their own reasons.
January 2022 is a painful start for investors. In the same month, the growth enterprise market fell by 12.45%, ranking the bottom of major global indexes; The Shanghai Composite Index fell by 7.65% in a month, exceeding the increase for the whole year of 2021. However, the Shanghai Composite Index rose by 22.30%, 13.87% and 4.80% from 2019 to 2021. The growth enterprise market was even worse, with an increase of 43.79%, 64.96% and 12.02% respectively in the three years.
It is worth noting that the net inflow of capital from the north, known as "smart money", reached an all-time high in 2021. In 2021, the net inflow of funds from the North reached 432.169 billion yuan, including 193.727 billion yuan from Shanghai Stock connect and 238.442 billion yuan from Shenzhen Stock connect. The cumulative net inflow of the whole year increased by 106.85% year-on-year compared with 2020. It shows that international investors continue to pay attention to the allocation of A-share market.
In January 2022, A-Shares not only failed to usher in a "good start", but even ushered in a relatively tragic decline, but the cumulative net inflow of northward funds in that month was still 16.775 billion yuan. Among them, the net capital inflow of Shanghai Stock connect was 18.588 billion yuan and the net capital outflow of Shenzhen Stock connect was 1.814 billion yuan. With the gradual appearance of policy effect and the large inflow of funds going north, Haitong Securities Company Limited(600837) believes that the upward trend of the value sector is not over, and the later growth sector is expected to follow the performance.
However, in the face of major global markets that began to rebound during the Lunar New Year holiday, the biggest question for most investors is whether A-Shares can rise after the beginning of the year?
"Considering the three factors of economy, capital and stock market valuation, the A-share market will have structural opportunities in 2022." Zhou Weiwen of China Europe Fund said that the probability of the global epidemic improving is increasing and the macro-economy will maintain a certain growth. The growth rate of China's economy is declining slowly due to the new construction of real estate, the possible gradual recovery of foreign supply chains, destocking and other reasons. Corresponding to the trend of economic growth, the low interest rate environment abroad will change, prices will rise, and the Federal Reserve will recover liquidity in the future. China has been relatively proactive in dealing with the epidemic, and the central bank's policies are more forward-looking. Under the background of low macroeconomic growth expectations, the currency will be relatively loose, which is beneficial to reducing the volatility of the stock market. At present, A shares have undergone two years of structural bull market. The overall valuation is not low, there are some structural bubbles, and there are also sectors with reasonable or undervalued valuation, and there are structural opportunities.
how did U.S. stocks and A-Shares perform during the previous interest rate hikes?
Since the upcoming interest rate hike has the greatest impact on the trend of US stocks, what about the performance of US stocks during the previous interest rate hikes? How does the Fed's interest rate hike affect a shares?
Dow Jones market data show that since 1989, during the Fed's interest rate hike, the average return of the Dow Jones industrial average is close to 55%, the return of the standard & Poor's 500 index is 62.9%, and the average positive return of the Nasdaq composite index is 102.7%.
During the Fed's interest rate cut, the average return of the Dow was 23%, that of the S & P 500 was 21%, and that of the Nasdaq was 32%.
Although the data show that during the interest rate hike cycle, US stocks rose more and fell less, the initial fluctuation of interest rate hike is inevitable. Goldman Sachs chief U.S. stock strategist mentioned that in recent interest rate hikes by the Federal Reserve, the S & P market will fall by an average of 6% in the three months after the first interest rate hike. However, the rate of return will turn positive to 5% within six months after the first interest rate increase.
As for a shares, Haitong Securities Company Limited(600837) Research Report data show that although the A-share market has not been established for a long time, it has also experienced four rounds of interest rate increase cycles of US stocks. After the resumption of the previous four interest rate increase cycles of the Federal Reserve, it is found that during the interest rate increase cycle of the Federal Reserve, the global stock market tends to fall first and then rise, while the performance of the A-share market is relatively independent.
