Key investment points:
Us non farm payrolls in January were better than expected, supporting the Fed’s guidelines for raising interest rates in March. On February 4, the US Department of labor released non farm payrolls data in January. 1) New non-agricultural employment: after the quarterly adjustment in January, the non-agricultural employment population in the United States increased by 467000, the largest increase since October 2021. It is expected to increase by 150000, higher than expected. The previous value was revised up from 190000 to 510000, and in November, it was revised up from 249000 to 647000; 2) Unemployment rate: the unemployment rate in the United States in January was 4%, expected to be 3.9%, the previous value was 3.9%; 3) Labor participation rate: the employment participation rate of the United States in January was 62.2%, with an expected 61.9%; 4) Average hourly wage: the average hourly wage in the United States in January increased by 0.7% month on month, expected to increase by 0.5%, and the previous value increased by 0.6%.
Overall, before the data were released, the market generally expected that the US employment data might be weaker than expected under the severe background of the spread of Omicron in winter. However, the data showed that the recovery of the labor market was still strong, the labor participation rate was further repaired, and the month on month increase of hourly salary was higher than expected. The non-agricultural growth in the first two months of superposition has been revised up, and the data after the revision continues to be good, which supports the guidance of the Federal Reserve to raise interest rates in March. Although the unemployment rate is slightly lower than market expectations, the rebound of labor participation rate is expected to continue the momentum of subsequent employment repair. In terms of market performance, gold closed down and US bond yields rose. Considering that inflation is still high and the US federal funds rate futures show that the probability of raising interest rates by 25 BP in March is more than 85%, we maintain the original view that the Federal Reserve may withdraw from QE in March and is expected to start raising interest rates in March.
The Bank of England and the European Central Bank released hawkish signals
On Thursday, February 3, the European Central Bank issued a monetary policy resolution to keep the three major interest rates unchanged, that is, the marginal loan interest rate is still 0.25%, the main refinancing interest rate is still 0%, and the deposit convenience interest rate is still – 0.5%. 1) The European central bank reiterated its commitment to slow app asset purchases in 2022. In the second quarter of this year, the asset purchase plan will be implemented at the rate of 40 billion euros per month, and in the third quarter, the debt purchase plan will be implemented at the rate of 30 billion euros per month; From 20 billion euros a month. 2) The PEPP purchase speed of anti epidemic emergency bond purchase in the first quarter will be lower than that in previous quarters, and the net purchase of new bonds of the project will end as scheduled in March.
On Thursday, February 3, the Bank of England raised the benchmark interest rate by 25 basis points to 0.50%, and plans to completely end the purchase of corporate bonds and start the passive table contraction and sale of corporate bonds.
Overall, the contents of the meetings and press conferences of the two central banks are slightly hawkish. 1) The expression of keeping the three major interest rates unchanged and the scale of negotiated bonds is basically consistent with the European central bank interest rate meeting in December. However, after the press conference, ECB president Lagarde did not reiterate her previous statement that “it is unlikely to meet the conditions for raising interest rates in 2022”, but only said that she would carefully evaluate the situation and rely on data to make judgments. Superimposed on January 2022, the CPI of the euro zone increased by 5.1% year-on-year, reaching a new record, triggering an increase in the market for the possibility of the European Central Bank raising interest rates during the year. Bond yields of major eurozone member states including Italy and Germany rose sharply after the meeting. 2) Money market expectations for the Bank of England to raise interest rates in March have reached 37.5 basis points. The yield of UK 10-year Treasury bonds rose 10bp to nearly 1.4%.
The weekly financing balance decreased. From January 24 to January 28, the financing balance of A-Shares was 1620.238 billion yuan, a month on month decrease of 31.338 billion yuan. The balance of financing minus securities lending was 1527.308 billion yuan, a month on month decrease of 24.493 billion yuan.
Zhou Du has a net outflow of funds to the north. From January 24 to January 28, the net sales volume of luchutong in that week was 26.070 billion yuan, including 253.711 billion yuan of purchase volume and 279.781 billion yuan of sales volume. Hong Kong stock connect had a net purchase transaction of HK $9.75 billion on the same day, including a purchase transaction of HK $50.940 billion and a sale transaction of HK $412.90.
Weekly money market interest rates generally rose. From January 24 to January 30, Bank Of Shanghai Co.Ltd(601229) inter-bank offered rate Shibor’s overnight interest rate closed at 2.1550%, up 5bp, and Shibor’s weekly interest rate was 2.2720%, up 9bp. The weighted interest rate of pledged repo of deposit institutions was 2.1697% overnight, up 24bp and 2.3056% a week, up 26bp. The 10-year yield to maturity of China national debt was 2.6997%, up 2bp.
The three major stocks in the United States generally rose, while the European stock market fluctuated. From January 31 to February 4, the Dow Jones Industrial Average closed at 35089.74 points, up 1.05%; The S & P 500 index closed at 4500.53 points, up 1.55%; The NASDAQ index closed at 14098.01, up 2.38%. In European stock markets, Germany’s DAX index fell 1.43%, France’s CAC40 index fell 0.21%, and Britain’s FTSE 100 index rose 0.67%. In the Asia Pacific market, the Hang Seng Index closed at 24573.29 points, up 4.34%.
The dollar index fell. From January 31 to February 4, the dollar index fell 1.80% to 95.4683. The spot exchange rate of offshore RMB against the US dollar closed at 6.3621, up 0.14%.
Gold rose and crude oil rose. From January 31 to February 4, Comex gold futures rose 0.92% to close at US $1808.80/oz. WTI crude oil futures rose 5.30% to close at US $91.92/barrel. Brent crude oil futures rose 4.10% to close at US $92.52/barrel. LME copper three-month futures rose 3.99% to close at US $9875 / ton.
