Viewpoint: according to PMI data for two consecutive months, the economy has rebounded, but on the whole, it is still a rebound, and the downward pressure is still large. However, the data recovery may boost the market in the short term. In addition, with the support of relatively stable fundamentals and liquidity, the market as a whole has maintained a good foundation. After the central bank lowered the reserve requirement and LPR in the fourth quarter of last year, the central bank lowered the MLF and reverse repo interest rate in the beginning of the year, and the monetary easing cycle gradually opened. Under the expectation of abundant liquidity, the market as a whole was still boosted. In the short term, the overseas market has rebounded, the impact of A-share sentiment has eased, the sectors have been repaired in turns, the overall shock bottoming process, and the gradual strategic allocation can be considered for bargain hunting.
Although the market volatility increased in February, the Shanghai composite index ranked in the forefront of the main broad-based index with an increase of 3%, and the overall performance is commendable, which also shows that during the fluctuation period, the stability and overall support of value stocks are relatively strong. On the contrary, during the sharp decline of the gem, theme stocks fell one after another, and individual stocks were weak as a whole.
In March, from a historical point of view, the effect of making money is not very strong, but mainly stable. For example, in the past 12 years, the highest average increase of major indexes has not exceeded 2%, and the overall increase is still relatively low. In March of the past 12 years, the absolute rate of return of CSI 500 was positive five times, outperformed the market seven times, and the average increase and cumulative net value were also in the forefront. If we only refer to the historical market, we still have expectations for March. After all, under the overall stability, it is still conducive to the stabilization of the market. However, history can only be used as a reference. The market in March should refer to the current fundamentals and comprehensive factors.
On the current fundamentals, we can see that the just released economic data show that in February, China’s Manufacturing Purchasing Manager Index (PMI) was 50.2%, up 0.1 percentage points from the previous month, continuing to be higher than the critical point, and the prosperity level of the manufacturing industry increased slightly. PMI has been on the rise and fall line for four consecutive months. This leading indicator of the economy shows that the economic stage has stabilized and rebounded. Although the pressure on economic growth is still large throughout the year, the short-term support for the market is also self-evident; In addition, with the boost of the steady growth policy, the effect continues to appear and has a certain boost to the market. The continuous strengthening of the steady growth sector since February is a good evidence. In terms of liquidity, with the opening of the monetary easing cycle, the expectation of macro easing has been released continuously, which has boosted the market.
Therefore, the current market as a whole, the lower support and boost is still relatively strong. However, under the influence of the Fed’s interest rate hike and overseas conflicts, market sentiment has suppressed the possible performance of the index. However, in the short term, the emotional impact is gradually slowing down, and the overseas market has also ushered in a rebound. The overall shock of A-Shares is repeated, the trading volume is released intermittently, and the probability of bottoming as a whole is increasing. On the sector, after the previously underestimated value and the continuous performance of the stable growth sector, the recent growth stocks are also rotating, and the overall repair of the sector is still open, which still promotes the development of the market.
Therefore, in the coming March, we are not pessimistic about the market. Especially with the gradual recovery of market sentiment and the good expectation of policies at important meetings, the bottom of index shock and restorative market are still worth looking forward to. At present, the market is still in the “late spring cold” stage, but the downward space is not large, and the interval repeatedly rubs the bottom. At this stage, value and growth may alternate, but the probability of trend market is low. Radical investors can consider gradually strategic allocation. Under the continuous tracking of undervalued and stable growth sectors, oversold high boom growth stocks have prominent cost performance at present, and bargain hunting allocation can also be considered after continuous adjustment.
