Key investment points:
1、 The epidemic situation is resurgent, but it is difficult to produce a “black swan”: the epidemic situation is resurgent and the global capital market is plummeting. Compared with the delta mutant strain found in India last October, it contains a total of 15 mutations; The Omicron mutant has more mutations than the delta strain. At present, it is known that the mutant carries at least 32 mutations. According to the statement released by the who on Friday, preliminary evidence shows that compared with other VOC variants, this variant has an increased risk of reinfection, and may spread faster than previous rounds of infection. Omicron mutant has stronger drug resistance and faster transmission rate. Therefore, we can not ignore the impact of Omicron mutant on industrial production in countries with weak overseas epidemic control and the stalling of economic recovery. The resumption of the “delta” mutant still has strong infectivity to the existing vaccinated population, and the European and American stock markets also plummeted. However, the panic in the U.S. and European stock markets did not affect a shares, and the performance of China’s stock market was relatively stable in the same period, thanks to China’s strict epidemic prevention and control and the high popularity of vaccination.
2、 Stable credit landing: the third quarter implementation report is a signal of monetary loosening to a certain extent, so we are optimistic. The logic of expected easing is that the previous expression of “general monetary gate” was deleted in the monetary policy implementation report, which was previously added in 2020q3 and lasted until 2021q2. In addition, the report added emphasis on “I-centered”. We believe that the deletion of the expression of “general monetary gate” in the previous report means that we should “enhance the stability of total credit growth”. Secondly, the addition of “me first” is to guide expectations. China’s monetary policy is independent rather than completely affected by the Federal Reserve. Due to the economic pressure in the fourth quarter and the first and second quarters of next year, the central banks of the two countries may have different monetary policy choices, This means that the credit contraction rate has come to an end, gradually turning to stable credit, or even structural wide credit.
3、 The outbreak of black swan, the Fed’s monetary policy may be disturbed: the stock markets in Europe and the United States plummeted, the resumption of trading “delta” mutant strain, and there was a wide range of panic in European and American countries, mainly due to the fear that the process of industrial resumption of production was blocked and the economy swayed again. However, due to the experience of epidemic control in various countries at the present stage and the high vaccination rate, Therefore, on the whole, the economic impact of the “delta” mutant on European and American countries is not obvious, but the “Omicron” variant has high infectivity and high pathogenicity, and the number of mutations is twice that of the “delta” mutant. Due to the laxity of prevention and control in western countries, the epidemic Black Swan cannot be ruled out, and the Federal Reserve launched the flexible QE reduction plan in November, It shows that the Fed has no preset policy path, and the future policy path will be largely based on the research and judgment of the trend of employment and inflation under the evolution of the epidemic situation. Once the “Omicron” variant proves that the vaccine protection is weak, it will affect the trend of monetary policy of the fed.
4、 Allocation ideas: 1. Short term search for structural opportunities for epidemic prevention and warming up under epidemic related themes (vaccines and medical protection). 2. “Double carbon wide credit” + strong science and technology themes (wind power, photovoltaic, new energy vehicles – parts, lithium battery upstream resources, rare earth use, UHV, semiconductor)
Risk tip: Sino US trade friction has intensified and the epidemic has not been effectively controlled
