Since November, the market has continued to pick up. The Shanghai index stood at 3600 this week, and the all a index is only one step away from the new high. Near the end of the year, the expectation of steady growth is fermented again. In fact, since the national standing committee meeting in July, the discussion on stabilizing credit and steady growth has begun to increase. What is the actual effect of steady growth so far? What enlightenment does the year-end market and spring agitation in history give us?
The general direction of steady growth is set, and the cross year stage is an important window. From the "cross cycle regulation" proposed by the national Standing Committee in July to the "six stabilities" and "six guarantees" again in November, and then to the premier's proposal this week to "timely reduce reserve requirements and increase support for the real economy, especially small, medium and micro enterprises", the direction of steady growth has been continuously confirmed, and the cross cycle regulation in the cross year stage is expected to be upgraded. On December 3, the Guangdong Provincial People's government agreed to send a working group to Evergrande Real Estate Group Co., Ltd. to promote enterprise risk disposal. The cbcirc said that at this stage, the real estate development loans and M & A loans should be issued reasonably to promote the steady and healthy development of the real estate industry and the market, and the credit risk of the real estate industry is expected to be resolved steadily and orderly.
Since the fourth quarter, steady growth measures have achieved initial results. Since the July national standing committee meeting, discussions on stabilizing credit and steady growth have begun to increase. From the actual effect, in addition to the bottom of the social finance growth rate stabilizing in October, the high-frequency data show that after the collapse decline in October, the upstream and downstream data of real estate began to improve marginally, the land trading volume and the construction volume of the real estate market recovered significantly, and the apparent consumption of threads and wires representing the upstream demand of real estate infrastructure projects rebounded significantly, The land transaction area of the top 100 cities has also returned to the historical normal range.
Good scenery at the end of the year: historical year-end market and restless resumption in spring. According to the historical experience of a shares, December is the long window period second only to February. Since 2010, the probability of the broad-based index rising in a single month in December has reached more than 60%, and the average and median of the increase have only lagged behind that in February. From the perspective of style, undervalued overvalued, large cap small cap and value growth are relatively dominant, that is, value style is usually more advantageous. Further observing the restless market in spring over the years, we summarize the following characteristics: 1) all kinds of indexes have a high increase in the 20 trading days before and after the Spring Festival; 2) From the perspective of style, overvalued undervalued, small cap large cap and growth value are relatively dominant, that is, the market is more inclined to offensive sectors; 3) Taking the time point of the Spring Festival as the axis, the relatively dominant time points of overvalued value, small cap and growth stocks are mainly concentrated in 6-8 trading days before and after the Spring Festival, which is also the main period in which the offensive style is dominant.
The direction of cross year agitation is gradually clear. Under the tone of construction in progress, delivery and stable expectation, the cash flow of real estate enterprises and the sales pressure of the real estate market have been alleviated; Recently, the issuance of local special bonds has been accelerated, the change of local government has been completed, and the demand for asphalt has rebounded anti seasonally. In this scenario, it is not appropriate to be overly pessimistic about traditional infrastructure. At the end of the year, the credit conditions will be stabilized in a real sense, and the pessimistic expectation of the economy is expected to turn. For the future, the high volatility in the overseas market may continue for some time, but the core contradiction of A-Shares is not outside. On the one hand, we pay attention to the Politburo meeting and the central economic work conference held this month. On the other hand, we focus on the signals of the stabilization of M1 growth rate and the further reversal of real estate credit risk. If the m1-ppi scissors difference confirms the inflection point in the future, it will open the upward space of the index.
Core conclusions and strategic suggestions: good scenery at the end of the year, and the market focus continues to favor steady growth. (i) The steady growth direction has been set and initial results have been achieved. The credit conditions are expected to stabilize in a real sense at the end of the year. In the medium term, we will continue to be optimistic about the recovery of value stocks, recommend food and beverage and consumer services for large consumption, underestimate the value, and pay attention to high-quality banks, state-owned enterprise developers and power operation; （2） New and old infrastructure development direction, the first push: construction / building materials, scenery storage, UHV; (III) upstream cost reversal auto parts, small household appliances, and independent main line military industry.
Risk tips: 1. The epidemic situation is out of control; 2. A sharp recession; 3. The policy has changed more than expected.
