According to Xinhua news agency, Russian President Vladimir Putin signed an order on the evening of the 21st to recognize the “Donetsk people’s Republic” and “Lugansk people’s Republic” in eastern Ukraine.
The international market fluctuated violently, the European stock market fell sharply overnight, and the Asia Pacific stock market generally fell sharply at the opening. As of the close, the Shanghai Composite Index fell 0.96%; Hong Kong’s Hang Seng Index fell as much as 2.69%. As US stocks are closed on Monday (US public holiday), traders are generally cautious, and subsequent US stock fluctuations may continue to be transmitted to global markets. On February 22, Contemporary Amperex Technology Co.Limited(300750) , Kweichow Moutai Co.Ltd(600519) these two foreign heavy position stocks “broke their positions together”, and traders suspected that there were signs of outflow of hedge funds. The net outflow of funds from the North throughout the day was 7.34 billion yuan.
As of 17:55 Beijing time on February 22, the US stock panic index soared to 30.75, up more than 10%. The three major futures indexes of US stocks fell by more than 1%.
the world is pricing huge geopolitical risks
Goldman Sachs released a report that the global market has been pricing huge geopolitical risks, but if there is a conflict between Russia and Ukraine, the risk premium of all industries has room to rise further. In this case, the US stock market will fall by more than 6% and the European stock market will fall by more than 9%.
\u3000\u3000 “Russia announced that Putin plans to sign a decree recognizing the independence of Ukraine’s two self styled republics by the separatists. This may be considered as an excuse for Russia’s invasion of Ukraine, and the Biden Putin summit is held on the premise of no invasion, so it may provoke leaders of various countries and urge Biden to withdraw from the summit. Russia also claimed that Ukrainian rebels had tried to use force Loading vehicles into Russia. ” Matt Simpson, a senior analyst at Jiasheng group, told reporters that there seemed to be little hope for the summit. Then there was a classic hedging trend. Investors entered bonds, gold and Swiss franc, leading to the decline of US stock index futures and bond yields.
The Swiss franc is the strongest major currency, even stronger than the yen. In the event of Russia’s invasion of Ukraine, the prospect of sanctions may suppress the performance of the Russian ruble. “The ruble fell by about 3% against the US dollar, with a standard deviation of 2.2. This has happened only twice since March 2020.” Simpson said.
The key is that the market has not fully priced risk in the past few weeks, which seems to indicate that subsequent volatility may intensify. “Military conflict is still the biggest single threat to a generally stable market situation, but the VIX has also been basically stable recently, with most transactions in the usual range of 20% ~ 30%. The foreign exchange market volatility of G7 economies has increased, while that of emerging economies has decreased. We believe that the deterioration of the risk environment exceeds the confirmation of many market signals.” “Please fasten your seat belt,” Eric robertsen, chief global strategist of Standard Chartered, told reporters
So far, the currencies of emerging economies have not responded. For example, the Indonesian rupee and rupee bond yields have always been good indicators to measure risk aversion, especially when the US bond yields soared, but the rupee fluctuated less than 10% a year and was close to returning to the pre epidemic level. The agency believes that it is necessary to be vigilant against subsequent volatility amplification.
Recently, affected by the deterioration of Russia Ukraine relations and other factors, oil and natural gas prices have soared again. Russia is one of the world’s three largest oil producers except Saudi Arabia and the United States, with supply and output accounting for about 11% of world demand. Europe is Russia’s largest export destination. In 2020, about half of Russia’s crude oil and condensate exports (48%) went to European countries, especially Germany, the Netherlands and Poland. If the tension intensifies, the oil pipeline through Ukraine may be forced to be interrupted. Compared with oil, Europe is more dependent on Russian natural gas, and tensions have a greater impact on natural gas.
In fact, the main contract of Brent crude oil futures rose by 400% from the low point in 2020. Robertson said that this increase has exceeded the 250% increase during the global financial crisis, and the natural gas prices of several major economies have also risen sharply. At present, the gasoline price in the United States is only about 15% behind the high of $4.11 in 2008. The rise of energy prices will have a great impact on people’s livelihood, inflation, monetary policy and capital market.
heavy foreign stocks broke down
Geopolitical risks also hit the risk sentiment of a shares. On the 22nd, the Shanghai Composite Index closed down nearly 1%, and Hong Kong stocks once fell close to 3%.
As of the close, Contemporary Amperex Technology Co.Limited(300750) fell 1.18% to 504 yuan and Kweichow Moutai Co.Ltd(600519) fell 3.68% to 1807.87 yuan. According to dateyes, as of 14:00, the net capital outflow from the North was nearly 10 billion yuan. According to the data, Kweichow Moutai Co.Ltd(600519) foreign capital net sold 690 million yuan, Industrial Bank Co.Ltd(601166) , Longi Green Energy Technology Co.Ltd(601012) , Ping An Insurance (Group) Company Of China Ltd(601318) were sold 216 million yuan, 163 million yuan and 83 million yuan respectively.
As of 14:30, the MSCI China A50 connectivity dollar index of “ningmao in hand” fell 1.7%. Since the index peaked on December 13, 2021, it has retreated by more than 11%.
In addition, China Clearing announced the changes of investor data in January. In January, the number of new investors decreased by 3.6% month on month and 36.77% year-on-year, a new high in nearly six years. Wu Zhaoyin, director of macro strategy of AVIC trust, told reporters that what is consistent with the downturn of investors entering the market is the obvious lack of incremental funds in the market. In January this year, the issuance of public funds (equity funds and hybrid funds) was only 70 billion yuan, while in January 2021, the issuance of public funds was 500 billion yuan. At the same time, the capital inflow from the North has also shrunk significantly. As of February 21 this year, the net capital inflow from the north is only 21.6 billion yuan, compared with 88.6 billion yuan in the same period last year. With the rapid decline of the net value of public funds, it is not ruled out that there will be basic people’s redemption, which puts great pressure on the stock of institutions.
At the same time, the rise of overseas inflation and the tightening expectation of U.S. monetary policy have led to the decline of global risk appetite and the decline of the prices of U.S. stocks, bitcoin and other risky assets. The three major U.S. stock indexes have fluctuated downward, and the price elasticity of bitcoin is greater, which has fallen from $69000 in early November last year to about $40000 in the near future.
However, the selling behavior of foreign capital may be more urgent feedback on risk events. In fact, the choice data also shows that there are signs that foreign capital continues to copy the bottom of the new energy sector in the near future. In the past five trading days, northbound capital increased its holdings of several stocks with the largest market value: China stock market news (RMB 1.164 billion), Shenzhen Inovance Technology Co.Ltd(300124) (RMB 1.065 billion), Byd Company Limited(002594) (RMB 671 million), Sungrow Power Supply Co.Ltd(300274) (RMB 617 million), China Merchants Bank Co.Ltd(600036) (RMB 593 million), Inner Mongolia Yili Industrial Group Co.Ltd(600887) (RMB 549 million), Contemporary Amperex Technology Co.Limited(300750) (RMB 481 million), Advanced Micro-Fabrication Equipment Inc.China(688012) (RMB 476 million), Shanghai International Airport Co.Ltd(600009) (RMB 470 million), etc.
“Since the fourth quarter of last year, there has been a wave of significant adjustment in the new energy track. Driven by the dual carbon target, the trend of steadily increasing the penetration rate of new energy vehicles will continue. It is expected that the industry growth rate of new energy vehicles will still be in the first tier compared with other industries in 2022,” Zhao longlong, fund manager of Shanghai Investment Morgan, told reporters
“After a period of adjustment in the past, the current valuation of new energy vehicle leaders or companies with more advantages in the competitive landscape has returned to about 40 times, while the corresponding growth rate is expected to be more than 1 times. From the perspective of dynamic valuation, the valuation level has been adjusted to a relatively cheap level.” Zhao longlong believes that the key layout can be carried out from three aspects: first, look for the four major materials in the battery field: positive electrode, negative electrode, electrolyte and diaphragm, including copper foil. Which links are still in relative shortage in 2022, which can continue the investment opportunities brought by the tight supply and demand in 2021; Second, pay attention to the industrial chain growth opportunities brought by the increased penetration of new energy vehicles in overseas markets, especially in the United States; The third is to pay attention to technological breakthroughs in battery technology, new materials and other fields.
In addition to new energy, foreign capital has also generally arranged some high-quality bank stocks, brokerage stocks with large asset management logic and concept stocks with subsequent game opening.
