The decline of the stock market caused the market’s emotional fluctuation on the wealth management business and triggered a sharp adjustment of securities companies’ stocks. However, the short-term fluctuation did not affect the broad demand market and long-term growth ability faced by the wealth management business, and continued to be optimistic about the growth of the securities industry. This valuation decline is expected to bring layout opportunities. Continue to recommend stocks with excellent fundamentals among leading and financial management characteristic securities companies, focusing on Citic Securities Company Limited(600030) , Huatai Securities Co.Ltd(601688) , China Industrial Securities Co.Ltd(601377) , Orient Securities Company Limited(600958) , and China stock market news.
Industry perspective
The recent sharp decline of securities companies stems from the negative sentiment of the market. Since 2022, the A-share market, led by the gem, has fallen sharply, causing fluctuations in the net value of public funds. 92.9 billion new public funds were issued in January, a decrease of 50% compared with December 2021. Recently, there are concerns about the redemption of public funds in the market. The negative sentiment in the market triggered a reduction in expectations for wealth management business, which led to a sharp decline in brokerage stocks. Among them, individual stocks with wealth themes fell the most. China stock market news and Gf Securities Co.Ltd(000776) fell 14.65% and 8.89% respectively this week.
The short-term scale fluctuation of financial management business will not affect the long-term growth ability. We will continue to recommend the trademarks of leading enterprises and financial management characteristic bonds. Although market fluctuations may lead to a temporary decline in the scale of public fund management business and consignment business in the wealth management industry chain, residents’ wealth continues to accumulate, the policy of “housing without speculation” is unswerving, and the demand for wealth management for the preservation and appreciation of residents’ wealth is still increasing. Therefore, the large asset management and consignment business of securities dealers still faces a large demand market. In addition, the investment advisory business aims to provide accompanying financial services centered on customer needs, which will enrich the format of wealth management in the long-term business model iteration. The transformation of wealth management is the general trend, which can contribute to the long-term growth of securities companies. After recent adjustment, the valuation of securities companies has dropped to a low level, and continue to recommend leading securities companies with strong comprehensive resources and capabilities and financial management characteristic targets benefiting from the torrent of the era of wealth management.
Key recommendation
\u3000\u3000 Citic Securities Company Limited(600030) 、 Huatai Securities Co.Ltd(601688) 、 China Industrial Securities Co.Ltd(601377) 、 Orient Securities Company Limited(600958) 、 China Stock Market News 。
One week data
Market: this week, the CSI 300 rose 1.08%, the gem index rose 2.93%, the securities industry fell 5.08%, the insurance industry fell 2.13%, and Internet Finance fell 0.49%.
Brokerage: the average daily turnover of stock base in the market this week was 913.9 billion yuan, down 7.83% month on month; The average daily turnover rate was 2.70%.
Credit: the reference market value of stock pledge in this week’s market is 3.80 trillion yuan (as of February 17, 2022), the same as last week; The balance of the two financial institutions was 1.72 trillion yuan (as of February 17, 2022), an increase of 0.42% over last week.
Underwriting: this week, the amount of stock underwriting was 34.3 billion yuan, the amount of bond underwriting was 86.2 billion yuan, and five IPOs were approved by the CSRC.
Risk tips
The impact of policy introduction, international environment, epidemic development and market fluctuations on the industry exceeded expectations.
