The profit growth of industrial enterprises increased in October. On November 27, the Bureau of Statistics announced the profits of Industrial Enterprises above Designated Size in October. From January to October, industrial enterprises above Designated Size achieved a total profit of 7164.99 billion yuan, a year-on-year increase of 42.2% and an average increase of 19.7% in the two years. In October, the monthly profit increased by 24.6% year-on-year. In October, the profits of industrial enterprises rebounded significantly, which was stronger than seasonality as a whole, corresponding to the high point of 13.5% year-on-year PPI in October. In addition to the base effect, the contribution of prices and profits of upstream industries is still the main reason for support, and the performance of other industries is relatively differentiated. However, the prices of coal and other raw materials fell in recent months under the measures of ensuring supply and stabilizing prices, and with the gradual peak decline of PPI, the subsequent transmission of profits from upstream to middle and downstream will continue, but the process is expected to be slow. Midstream and downstream enterprises still face great cost pressure, and the obvious improvement of downstream profits may still need the boost of terminal demand. The recovery of inventory was partly driven by shopping festival factors, and the sustainability of maintaining a high level in the future was limited. The follow-up PPI may slow down at a high level, but it is supported by the low profit base of industrial enterprises in November last year. It is expected that the profit growth rate of follow-up industrial enterprises will remain high, but the contribution of upstream industries to the whole industrial profit is expected to fall.
The national standing committee will deploy and improve the management of special bonds of local governments and optimize the use of funds. Premier Li Keqiang chaired an executive meeting of the State Council to deploy and improve the management of special bonds of local governments, optimize the use of funds and strictly supervise funds. Overall, since the beginning of this year, economic growth has shown a trend of high before and low after. Active fiscal policy has played a key role in cross cycle adjustment. Since the second half of the year, the issuance rate of local government special bonds has increased, and there are still hundreds of billions of yuan at the end of the year. At the end of the year, we should speed up the issuance of the remaining amount of this year, do a good job in fund allocation and expenditure management, strive to form more physical workload at the beginning of next year, sort out the special bond projects and fund needs next year, strengthen the overall planning of bond projects at the provincial level, and help the economy run well across cycles. The CPC Central Committee and the State Council: improve the multi-level old-age security system. The CPC Central Committee and the State Council issued the opinions on strengthening aging work in the new era, put forward various measures, integrate the concept of positive aging and healthy aging into the whole process of economic and social development, accelerate the establishment and improvement of relevant policy systems and institutional frameworks, and actively respond to the national strategy of population aging. On the whole, combined with the recently announced birth rate of less than 1% in 2020, population aging is China’s basic national condition for a long time in the future, putting pressure on labor supply, family pension and public services. According to the data of the seventh census, the proportion of China’s population aged 60 and over reached 18.70%, which increased by 5.44 percentage points from 2010 to 2020 compared with the previous decade. However, over the past decade, the life expectancy of China’s population has also continued to improve, and the quality of the elderly population is also improving. In the future, the development of “silver economy” will help drive the consumption of elderly products and services, and form a certain positive impact on the consumption and services of the elderly care industry.
This week, the market fluctuated and consolidated at a relatively high level. On the disk, nonferrous metals, biomedicine and chemical industry led the increase, while leisure services, agriculture, forestry, animal husbandry and fishery, national defense and military industry led the decline. On November 24, South Africa reported the discovery of the new covid-19 virus variant Omicron to the WHO. At present, many regions or countries around the world, including Hong Kong, China, have reported the discovery of the new variant. Its infection rate is much higher than the previous Indian delta virus. On the 23rd, nearly 20000 cases were newly diagnosed in South Africa, which has dropped in recent days. Under China’s strict prevention and control and supply chain stability, China’s current rapid response and dynamic clearing strategy, as well as the relatively strong stability of the supply chain, it is expected that “Omicron” will not have a great impact on China at present. It may have a certain impact on consumption, aviation and other sectors in the short term, but the impact may be limited in the medium and long term. Overseas risky assets fell sharply on Friday, but at present, in the futures market, the futures prices of crude oil and US stocks have stabilized.
