Looking back at 2021, the A-share market shows changes in market characteristics and driving logic. The index shows the trend differentiation of small index rise, large index adjustment and Shanghai index shock. The performance of individual stocks has also changed from rising less and falling more before the Spring Festival to rising more and falling less after the Spring Festival. Behind it is the change of institutional game mode after the issuance rhythm of public funds has increased from explosive growth to return to steady state.
Looking forward to 2022, the growth momentum at the macro level is under pressure. The continuous closure of the global supply and demand gap and the impact of the high base put downward pressure on exports. Under the domestic demand protection policy and the low base, the import growth rate will be higher than that of exports, superimposed with the rise of the service trade deficit, and the net export will form a slight drag on economic growth. In terms of domestic demand, it is difficult to change the direction of regulation and control, resulting in a significant decline in the growth rate of real estate investment. The decline in capacity utilization and the decline in revenue growth restrict the room for improvement in the growth rate of manufacturing investment. The decline in revenue growth and the reduced willingness to consume make the improvement of social zero year-on-year growth still slow. Infrastructure investment has become an important focus of replacement demand in 2022. In terms of inflation, different tail raising evolution trends and month on month growth levels will continue to close the scissors gap between PPI and CPI year-on-year growth, and the cost pressure of middle and downstream enterprises will be significantly alleviated. In terms of currency, innovative tools such as refinancing will still be the focus of maintaining currency stability and boosting credit; In terms of finance, the year-on-year growth rate of expenditure is expected to gradually recover in the first quarter of 2022, but the recovery range is still limited.
At the market level, for the overall trend of the A-share market, after the A-share valuation has gradually returned to reasonable in the past two years, the pressure from the valuation level will be weakened, and the possibility of ending the downward trend of valuation and fluctuating around the existing valuation level will increase in the future. In terms of performance, from top to bottom, although the economy is under certain pressure, under the care of cross cycle policies, the fundamental pressure is generally controllable. Considering that CPI will rise steadily, we expect the net profit growth of listed companies to be synchronized with the growth of revenue and nominal GDP. Combined with the consensus expectation of bottom-up adjusted analysts, the profit growth of Shanghai index may be about 8%. For the whole year of 2022, the growth of performance may determine the upward range of the Shanghai stock index center, and the valuation fluctuation in market operation finally determines the range level of the index. For the A-share market in 2022, we don’t think it should be pessimistic as a whole. For style judgment, we believe that there are opportunities for size indexes. On the one hand, under the catalysis of performance, valuation, policy and other factors, the market of small indexes is not finished to be continued; On the other hand, for some large indexes dominated by blue chips, it is expected to end the adjustment in the process of foreign capital overweight and show a recovery process. On the whole, the market style in 2022 will be more balanced.
In terms of industry configuration, generally speaking, the industry configuration can be carried out along the two main lines of trend continuation and dilemma reversal next year, combined with the downward benefits of PPI. Specifically, Attention can be paid to: (1) the background of the continuous promotion of the global energy revolution superimposes the “fengfengchu” plate benefiting from the downward trend of PPI; (2) the strategic position of the science and technology plate superimposes the “new infrastructure”, semiconductors and domestic software with high safety margin, as well as the media plate benefiting from new technology catalysis and valuation adjustment; (3) The valuation continues to digest, the medium and long-term performance is highly uncertain, and the consumption sector is expected to benefit from the continuous inflow of foreign capital next year; (4) the breeding sector with continuous clearing of production capacity and bargain hunting layout of the inflection point of the game.
Risk tip: the economic downturn exceeded expectations, and the promotion of industrial policies was less than expected.
