Main points
Macro view:
1. China’s steady growth is still in its early stage, and real estate is the main variable in the rhythm and degree of steady growth. The rhythm of China’s policy is related to the economic policy and rhythm of the United States, while the economic policy and rhythm of the United States are mainly related to inflation.
2. US inflation expectations are down, US economic policies focus on supply recovery and improvement of inflation, the economy tends to be stable, and the recovery of capital expenditure promotes the rise of real interest rate. However, monetary policy suppresses inflation and real interest rate at the same time, so the upward space of us nominal interest rate is limited.
3. The impact of U.S. monetary policy on major global assets should be viewed and judged from the perspective of supply and demand, but not from the perspective of liquidity. Short-term asset fluctuations and expectations are related to the game. China should have a comparative advantage in the future of U.S. economic growth, which will mean that under the time window of U.S. interest rate hike, it is possible to accelerate the inflow of foreign capital into China.
Market view:
1. The market style tends to be balanced in the short term, and the growth style will rebound in the short term after the rapid decline, but the main line of steady growth is not over, which suppresses the growth style. Coal with good long-term trend of carbon neutralization, new energy leader and automobile intelligence are the main directions.
2. In the short term, the anchor of China’s economic policy is not clear. The deterioration of the profit-making effect drives the short-term market to weaken. When the monetary policy is not tightened, the market probability is at the bottom.
3. This round of interest rate hikes in the United States is different from the previous rounds of interest rate hikes. Inflation has an increased weight on US monetary policy. This factor will have a certain impact on US stocks, but it will not change the upward trend of US stocks.
4. After experiencing the expected impact of liquidity last year, Hong Kong stocks are not vulnerable to the impact of U.S. monetary policy this year. On the contrary, there will be positive feedback from China’s steady growth on the profit side.
Optimistic about the sector:
1. Be optimistic about coal, real estate leaders of central enterprises, C-end real estate chain, food and beverage, automotive electronics and new energy leaders.
2. Be optimistic about Shanghai Stock Exchange 50, Shanghai and Shenzhen 300, Hong Kong stock Internet technology index and Nasdaq 100 index.
Market resumption: the overall sector performed well this week, with a large increase in stability, finance and cyclical style, and a correction in growth style. Most of the Shenwan class industries rose, with coal, petroleum, petrochemical and architectural decoration leading the increase; Pharmaceutical, biological, electronic and power equipment led the decline. The valuation of most industries has increased slightly, with little overall change.
Index performance: most of the major indexes rose this week, and the major indexes with large decline before the festival stopped falling and rebounded. The all a, CSI 300, CSI 500, SSE 50 and SSE Composite indexes rose by 1.24%, 0.82%, 2.50%, 2.91% and 3.02% respectively, while the gem index and Kechuang 50 continued to fall by 5.59% and 4.85%.
Style performance: large, medium and small cap stocks have rebounded, led by small cap stocks; The overvalued sector fell sharply, while the undervalued sector led the rise. Large cap stocks, medium cap stocks and small cap stocks rose 0.41%, 1.32% and 2.17% respectively. In the valuation sector, the overvalued value fell by 5.61%, and the medium valuation sector and undervalued sector rose by 0.25% and 7.06% respectively.
Short term market sentiment: compared with last week, the average daily turnover of major indexes increased month on month.
In addition to the gem index, the turnover rate of major indexes increased month on month. There is obvious differentiation in the activity of industry transactions. The net capital inflow to the North turned positive. During the week, the top three main inflow industries of land stock link are: banking, non bank finance and non-ferrous metals; The net outflow of pharmaceutical, biological, computer and power equipment industries is large. The number of shares held by the north capital industry increased on a weekly basis. The top three are: banking, non-ferrous metals and building decoration industry; The top three decreases are: pharmaceutical and biological, computer and power equipment industries. The implied volatility of SSE 50ETF option decreased by 7.76 percentage points, and the current value is 15.06%; The current value of the standard & Poor’s 500 volatility (VIX) index is 27.36, up 4.14 from the previous value.
Long term market sentiment: the yield of Shanghai and Shenzhen 300 dividend – 10-year Treasury bond is currently – 0.75%, down 0.12 percentage points month on month, above the average and in the historical quantile of 68%; The current value of A-share implied equity risk premium (ERP) is 2.59%, down 0.20 percentage points month on month, in the historical quantile of 80%, and the market risk appetite cooled in the early stage shows signs of warming up.
Risk tips
Economic downside risk; The epidemic rebound exceeded expectations; Liquidity tightening exceeded expectations; Overseas economic recovery is weaker than expected.
