Key investment points
This week's topic: the "steady growth" of social finance and the "virtual" and "real" of the Fed's interest rate hike: where is the root of the swing of market expectations
Social finance has generally improved, but the cycle of the new round of infrastructure real estate expansion has slowed down. In January, China's social finance scale increased by 6170 billion yuan, and the growth rate of social finance has rebounded for three consecutive months. RMB credit is the most important driving force for the growth of social finance in January. From the perspective of credit structure, enterprise loans form the main contribution, and residents' credit supply is still relatively weak. Benefiting from the advance of special bonds, the increment of government bonds is obvious, which also forms an important boost to social finance. As we expected earlier, the main economic and financial data in the first quarter will probably exceed market expectations, but this may not mean the restart of a new round of infrastructure real estate expansion cycle.
Since the end of last year, the market's expectation of steady growth has fluctuated sharply in two extremes: before and after the Politburo meeting, it is generally believed that the strength of steady growth in 2022 will not waver, and the country will probably restart the expansion cycle of real estate and large infrastructure in history in order to stabilize growth; After the central economic work conference, seeing that the real estate is only "passive relaxation", it began to turn pessimistic about the economy. The market generally believes that there is great downward pressure on the economy and zero year-on-year growth of social finance in January is a more optimistic situation. However, after the social finance data significantly exceeded expectations, market expectations may swing again. The essence or thinking of this swing still stays in the big fluctuation cycle of economy and policy 10 years ago.
As we have repeatedly stressed: the higher than expected social finance data in the first quarter may not mean the restart of a new round of infrastructure real estate expansion cycle. The relaxation rate of real estate is still limited to the scope of "passive relaxation". The effectiveness of the policy of "no speculation in housing", the social risk of polarization between the rich and the poor, and the inflection point of the population debt cycle do not support the restart of a new round of infrastructure real estate expansion cycle; There will be some efforts in infrastructure construction, but the financial constraints of local governments and the restrictions on borrowing make it difficult for infrastructure construction to make a particularly big improvement in the whole year. But at the same time, the higher than expected social finance data also indicates the continuation of the main line of the post holiday stable growth policy. It can be seen that the policy tone and concentration have not changed.
Does the Fed raise interest rates in real terms exceed expectations?
The US CPI rose 7.5% year-on-year in January, a 40 year high. The Fed's expectation of raising interest rates is further strengthened, and its policy spillover effect can not be ignored. The market has always believed that in order to protect US stocks, the Fed's interest rate increase will be similar to the interest rate increase in Yellen's period in 16 years (four word interest rate increase expectation is given, but only once in the end). Behind this idea, it is believed that US inflation will fall rapidly within the year. Once the "substantial interest rate increase", US stocks and the US economy may face huge problems. This idea often deviates from reality. Considering that the mid-term election is approaching, Biden's support rate is constantly at a new low, inflation is constantly at a new high, and voters are relatively dissatisfied with Biden. The fall in inflation and the huge problems in US stocks and the US economy after interest rate hikes are only a possibility in the future. Therefore, we believe that at least before the above risks really occur, the Fed's statements on substantive interest rate hikes will continue to be hawkish.
On the whole, the spring market is expected to go further under the environment that the global financial market gradually adapts to the hawkish shift of the Federal Reserve, the steady growth policies such as China's RRR reduction continue to work, and social finance and other indicators are expected to stabilize. The overall registration system and steady growth are good for undervalued blue chips, while the Fed's "hawks" may put pressure on the growth sector, and the strength and non record low of undervalued blue chips such as SSE 50 in the process of adjustment in January make us believe that the spring market is still the main line of undervalued blue chips. In terms of specific configuration, undervalued blue chips still adhere to three main lines: 1) securities companies; 2) Central enterprises with high dividends related to national reform, especially the development direction of central finance such as railway and electric power; 3) Green electricity. At the same time, some drugs related to the epidemic, such as ventilator and vaccine, have also entered the allocation range.
Risk tip: the implementation of the capital market deepening policy represented by the comprehensive registration system is less than expected, the Omicron epidemic in China broke out more than expected, the liquidity of the Federal Reserve's monetary policy and China's monetary policy tightened more than expected, and the public information used in the research report may be delayed or not updated in time.
