February 11 is the last trading day of the first week of the year of the tiger. Although spring has begun, the stock market still lacks warmth.
in the afternoon, the decline of a 10 billion real estate stock in the Hong Kong market made the market worse. Zhengrong real estate, a listed company controlled by Putian people, suddenly saw its share price plunge by 80%; The share price of its brother company Zhengrong service once plunged 85%.
The tragedy of Zhengrong real estate is only a microcosm of the tragedy of the stock market! Although the data of social finance far exceeded expectations, there is still room for structural adjustment. A fed meeting notice made the market nervous. As a result, the global market fell almost across the board. The bank informed that it would hold a closed meeting at 11:30 a.m. on Monday, February 14, 2022 to review and determine the advance payment and discount rate charged by the Federal Reserve Bank. Thus, the expectation of seven interest rate hikes and emergency interest rate hikes is reproduced.
Naturally, the A-share market is hard to escape, and the three major indexes closed green. In the morning opening session, Andon Health Co.Ltd(002432) an announcement directly hit the stock close to the limit; At noon, the news of centralized purchase of traditional Chinese medicine suddenly came, and the traditional Chinese medicine sector fell sharply across the board. On the whole, there are very few stocks rising in the A-share market, and the profit-making effect is very weak.
16 billion real estate stocks fell 80%
The market value of real estate suddenly fell by HK $12.3 billion in the afternoon of November, triggering the largest decline of HK $12.6 billion; Its brother company Zhengrong service also plummeted by more than 85%.
So, what happened? There are rumors in the market that Zhengrong real estate will no longer redeem us $200 million of perpetual bonds as previously planned in March this year, and the company’s overseas bonds will be restructured.
According to the data from the financial sector, Zhengrong real estate is a “Fujian real estate enterprise”, and the business scope of the company includes investment in real estate and trade, real estate development and operation, etc. The company is a large comprehensive real estate developer in China, focusing on the development of residential properties and the development, operation and management of commercial and comprehensive properties. Zhengrong real estate is the independent real estate business platform of Zhengrong group, which was listed on the Hong Kong Stock Exchange in 2018. Ou Zongrong, founder of Zhengrong group, was born in Putian, Fujian Province in 1964.
So, did the Putian department really explode this time? In response to the above negative rumors, Zhengrong real estate responded that the company would redeem us $200 million of perpetual bonds as originally planned. The relevant rumors were untrue. For the sharp decline in share price, Zhengrong real estate said that today, some institutions may maliciously short and buy again, and the company is further understanding the reasons for the decline in share price.
a notice from the Federal Reserve stunned the world
When the market falls, there will always be all kinds of bad rumors floating in the market, either true or false, or bright or dark. But for investors, most prefer to believe in what they have rather than what they don’t have. The biggest event affecting the market today is a notice from the Federal Reserve.
The notice points out that the board of Governors of the Federal Reserve is expected to hold a closed meeting at 11:30 a.m. local time on Monday, February 14. The meeting will be held at the board office on 20th and C streets northwest of Washington, D.C. The items tentatively considered at this meeting are: review and determination of the advance payment and discount rate charged by the Federal Reserve Bank by the Council. After the closed door meeting, the final announcement of matters considered under the expedited procedure will be published on the Federal Reserve website. The move was interpreted by the market as a signal of the Federal Reserve’s emergency interest rate hike. As a result, the global stock market fell across the board, the decline of US stock futures index was close to 1%, and most of the Asia Pacific markets also fell.
Analyst Garfield Reynolds said some people in the market were worried that the Fed meeting scheduled for Monday, February 14, could have a significant impact. The Fed’s notice that the proceedings of the meeting were expedited sounds a bit disturbing, but looks more routine. The meeting will be held behind closed doors to assess the prepayment rate and discount rate charged by the Federal Reserve to banks, exactly the same as the closed door meeting held on January 18. “Speed up” simply means that the meeting does not require a week’s notice.
however, due to the amazing inflation data released in the United States last night, Goldman Sachs expects the Federal Reserve to raise interest rates by 25 basis points at each time and seven times in a row at the remaining Federal Open Market Committee (FOMC) meeting in 2022.
Some institutions predict that Fed officials are not in a hurry to raise interest rates before next month’s policy meeting, and it seems unlikely to raise interest rates by 0.5 percentage points at the March meeting, although the higher than expected rise in US consumer prices has triggered relevant speculation. The emergency rate hike could send a panic signal and intensify criticism of the central bank’s slow pace in controlling inflation. Federal Reserve Chairman Powell predicted last month that the pace of price rise will cool down later this year. Powell showed the attitude of reaching consensus in the policy-making committee first. At present, no Fed official has hinted that he will be eager to take action before the meeting from March 15 to 16.
bad A-Shares
In fact, relatively speaking, A-Shares seem more panic than the peripheral markets. Even if the financial data released last night exceeded market expectations, the interpretation is still: social finance is very good, but the structure is very poor. To put it bluntly, M1 has not improved, and the loan demand is still insufficient. That is to say, the wide credit has not reached the expectation. However, if the credit extension meets the expectations, is it necessary to cut interest rates? This logic will not be extended too much for the time being. In terms of structure, it is indeed strong, and the head of hot money has been hit since the early morning.
According to Andon Health Co.Ltd(002432) disclosure, in the teleconference surveyed by the organization on February 10, in view of the company’s operation in the United States, the company said that at present, the tension between supply and demand has been alleviated, and the company’s current delivery schedule has been shortened. According to the current production schedule, it will be able to meet the needs of government and commercial customers as planned, The number of new cases announced in the United States has decreased compared with the previous period, and there is also a situation that they have not been counted because they have not been actively reported in the self-test with the kit. The contracts and orders being performed by the company have not been affected. Then, Andon Health Co.Ltd(002432) was once pressed to the limit in the morning.
In addition, Fauci said that the epidemic in the United States is coming to an end. Covid-19 detected the collective decline of the sector.
In the afternoon, news came out of the centralized collection of traditional Chinese medicine. The National Information Office held a regular policy briefing today. Chen Jinfu, deputy director of the National Medical Security Bureau, introduced at the meeting that speeding up and expanding coverage is the due meaning of normalization and institutionalization. In this area, further explore in other fields. Including Chinese patent medicine, based on the alliance procurement organized by some provinces last year, the scope should be further expanded in an orderly manner this year. The Chinese medicine index also fell 4.62% today.
Many people may ask, where is the bottom of the market? Judging from the past history, the bottom is difficult to guess, and there is no need to guess. For ordinary individual investors, there will be obvious warmth in the market, and they can participate in the next stage at that time. For institutional investors, they may be more concerned about the value of the company and industry, and have more expertise and resources to evaluate the value of the company and industry. If they fall to a certain position, they can gradually participate. That’s how the game came out step by step! Now, it is more likely to be a small structure market, and systematic opportunities may have to wait.
