Market outlook and recommendation of top ten gold stocks in December
In terms of economy, a series of economic data were released in November: in October, PMI returned to the top of the dry and prosperous line and returned to the expansion range, and both supply and demand recovered. In October, the profits of industrial enterprises increased steadily, the demand of consumer goods manufacturing industry recovered, and the high-tech manufacturing industry continued to maintain a high boom. In October, the new social finance exceeded the expectation of 1.59 trillion, an increase of 19.7 billion yuan year-on-year, and the social zero year-on-year growth rate was 4.9%. On the whole, under the “double limit” correction of the current economy, production activities have been repaired. In addition, the recovery of external demand has also led to the recovery of the demand side, which has improved both supply and demand. In terms of inflation concerned by the market, we see that the price of raw materials has peaked and fallen. Under the “guaranteed supply”, the pressure on the cost side of middle and downstream enterprises is expected to be gradually relieved. At present, some economic data have warmed up, but the downward pressure does still exist.
In terms of policy, the central bank’s monetary policy implementation report studies, judges and sets the tone for the next stage of monetary policy and economic situation. In the future, monetary policy faces a “dilemma” and seeks to balance “stable growth” and “controllable inflation pressure”. Under the increasing downward pressure on the economy and the changes in the economic situation outside China, we expect that the policy flexibility is expected to be improved in the next stage. Under the general tone of “focusing on me”, the monetary policy is expected to turn to marginal easing, but still focus on structural force.
At the performance level, the performance prediction rate of A-share annual report is 82%. In terms of performance growth, industries with rapid growth include medicine and biology, electronics, light industry manufacturing and electrical equipment, and the high boom is still dominant.
In terms of capital, A-share trading continues to pick up, and the cross-year market is expected to unfold slowly. Through the resumption of trading, we found that there has always been a “tail raising market” in land stock connect, and the allocation of land stock connect is often the big month from the fourth quarter to the beginning of the next year. Looking back at history, In 2017 / 2018 / 2019 / 2020 (November of the first year to January of the next year), the proportion of net inflow to total net inflow (rolling for 12 months) was 25.0%, 38.7%, 52.2% and 73.7% respectively, with a median level of 45.42% The substantial inflow of funds helps to improve market activity and risk appetite. Northbound funds recently prefer growth sectors such as electrical equipment and electronics. In addition, consumer varieties opened by cost mitigation and price rise also rank among the top in net inflow.
At the market level, recently, under the influence of the mutated virus, the peripheral stock markets have declined one after another, and the bulk commodities have fallen sharply. China’s “rapid clearing” epidemic prevention control method is conducive to maintaining a good state and has little impact on China’s economy and policies. From historical experience, the trend of A-Shares is relatively independent. Growth and some consumption are the main line of the recent market. If the impact of the mutant virus exceeds expectations, it may slow down the tightening pace of overseas monetary policy. In addition, China’s supply chain advantages will be highlighted again. We believe that some economic data have warmed up, with loose policy expectations and support at the performance level and capital level. It is expected that the cross year market in December is still expected to unfold slowly. It is suggested to pay attention to the double main line structural investment opportunities:
1) Stick to the allocation opportunities of high prosperity and high growth sectors. In the long run, the future policy direction will continue to focus on cultivating and supporting a number of high-end manufacturing enterprises with global competitive advantages. Benefiting from long-term policy support + high prosperity + loose liquidity margin, it is recommended to continue to pay attention to investment opportunities in high prosperity and high-end manufacturing represented by new energy and semiconductors.
2) Focus on tapping high-quality low-end varieties, especially low absorption opportunities in large consumption sectors. Subject to the gradual downward pressure on the economy and the decline in demand caused by the weak consumption intention after the epidemic, the transmission path from the pressure on the upstream cost side to the middle and downstream is not smooth. With the opening of the tide of price increase in the consumer sector, enterprises with strong future pricing power and brand advantages are expected to take the lead in benefiting. After the cost side pressure of leading companies is gradually relieved, they are expected to enjoy the dividend of raw material price decline + profit elasticity repair in the medium and long term. In 2022, leading companies of consumer goods are expected to usher in a new era of valuation and profit, It is recommended to focus on the leading companies of high-quality and large consumption with alpha attribute.
In December, the top ten gold stock portfolios of YueKai securities were: Shede Spirits Co.Ltd(600702) , Shantou Wanshun New Material Group Co.Ltd(300057) , Shanghai Friendess Electronic Technology Corporation Limited(688188) , Bozhon Precision Industry Technology Co.Ltd(688097) , Moon Environment Technology Co.Ltd(000811) , Fujian Torch Electron Technology Co.Ltd(603678) , Henan Lingrui Pharmaceutical Co.Ltd(600285) , Suzhou Anjie Technology Co.Ltd(002635) , Jiangsu Goodwe Power Supply Technology Co.Ltd(688390) , Ningbo Orient Wires & Cables Co.Ltd(603606) .
Risk statement
China’s economic recovery is less than expected, and the external environment is weaker than expected.
