Market view: internal support is getting stronger, external constraints are getting weaker, balanced allocation and active participation
In the first week of March, on the eve of the "two sessions", the market swayed between growth, stability and cycle, but no consistent main line was found, and the growth track fell again for adjustment. The Federal Reserve's interest rate meeting is approaching, and the market is facing a slight disturbance. However, with the national "two sessions" finalizing the economic growth target of 5.5% and the policy entering the full force period, it will significantly weaken the impact brought by the tension between Russia and Ukraine, and the improvement of A-share risk appetite will usher in important support. It is suggested to actively participate in the layout. In terms of configuration, we are optimistic about the stable growth chain with stable recent performance in the short term, continue to participate in the market of the third stage of growth in the medium term, and pay attention to the growth main line and growth diffusion market.
The "two sessions" set an overall growth target of 5.5% for the whole year, and the policy entered a period of full force, boosting market risk appetite. The government work report of the national "two sessions" is expected to achieve the annual economic growth target of about 5.5% in 2022, exceeding market expectations. The policy is in full force, the monetary policy is loose and continues, and there is still room for further RRR and interest rate cuts. The fiscal policy has sufficient strength, which has become the most important support to achieve the annual economic growth target. The real estate regulation policy will continue to warm the tone, and the marginal easing will continue. There is no need to be overly pessimistic about the pull-down effect of investment on the economy. Meanwhile, the economic growth target of 5.5% has dispelled the previous market concerns about economic growth and will become the most important support to boost risk appetite. The impact of the tense situation in Russia and Ukraine on the risk appetite of US stocks and A-Shares will be significantly weakened.
Monetary easing is abundant, and micro liquidity releases positive signals. Recently, the central bank has significantly withdrawn reverse repo funds, and the short-term interest rate is still stable, mainly due to the abundant liquidity in the "currency first" stage in the early stage. The interest rate cut is expected to be 5.5% for the subsequent loose monetary policy. In terms of micro liquidity, the turnover is stable at the trillion level, and the position index shows that the proportion of fund allocation has increased recently, with positive signals continuously released.
The overall tone of economic improvement throughout the year was basically confirmed. PMI rebounded seasonally, and the positive economic trend was confirmed. The medium and high-speed growth target of 5.5% on the high base set by the "two sessions" fully reflects the government's determination to stabilize growth. GDP growth in the first three quarters of 2022 is expected to rise step by step. In the near future, the direct efforts of the government will focus on infrastructure investment and real estate regulation policies. In February this year, the PMI increased by 0.1 percentage point instead of decreasing from January, indicating that the expectation of economic recovery is further improved.
Industry allocation: continue to maintain balanced allocation under the continuation of market fluctuations
Under the continuation of market fluctuations, we will continue to maintain balanced allocation, be optimistic about the stable growth chain with stable performance in the short term, and continue to participate in the third stage of growth in the medium term. In the first week of March, the market accelerated its rotation before the two sessions. The cycle style represented by coal, transportation, agriculture, forestry, animal husbandry and fishery performed well, while the growth style retreated to a certain extent, and the steady growth chain remained relatively stable. Looking forward to the second week of March, although the economic targets announced by the two sessions at the weekend help the market unify expectations, the market still has great differences on the range of interest rate increase and table contraction near the Federal Reserve interest rate meeting. Therefore, it is expected that the market fluctuation will continue, and it is suggested to continue to maintain a balanced allocation.
Overall, the configuration continues to focus on three main lines and two themes. Main line 1: continue to participate in the market of the third stage of growth. Specifically, we can focus on the growth main line represented by double carbon and semiconductor, as well as national defense, military industry, communication and computer under the growth diffusion; Main line 2: add a stable growth chain with relatively stable short-term performance, and focus on new and old infrastructure fields such as building materials, building decoration, urban pipe network transformation and new power grid construction, as well as relevant opportunities such as real estate and banking; Main line 3: in terms of consumption, we will continue to pay attention to the travel chain of airport, tourism, catering, leisure and other services in the short term, as well as the overall opportunities of the pharmaceutical sector; Grasp the opportunities related to dairy products, planting industry and chemical fertilizer with smoother price rise in the medium and long term; In terms of themes, we will continue to pay attention to the digital economy and investment opportunities related to the reform of state-owned enterprises.
Risk tips
There are deviations in policy interpretation; The development of Omicron mutant strain exceeded expectations; Risk Spillover of geopolitical conflict between Russia and Ukraine; Sino US relations deteriorated beyond expectations.
