Macro economy: last week, the meso production index operated smoothly. It is preliminarily estimated that the year-on-year growth rate of CPI in December is 1.6%, and the year-on-year growth rate of PPI is about 11%. Last week, the central bank invested 50 billion in net funds, and the money market capital interest rate decreased.
Equity market: the strength of fiscal policy is a necessary condition for achieving economic stability. Considering the four factors of capital, project, power and necessity, we believe that although the power recovery of local governments remains to be evaluated, the other three aspects point to the strength of fiscal policy in the first quarter. In terms of investment direction, it is suggested to pay attention to the direction of “stabilizing growth, adjusting structure and ensuring people’s livelihood”, and look for areas where new infrastructure can enable traditional infrastructure. The corresponding subdivided industries include building materials, transportation and other industries in traditional infrastructure, new energy power generation, smart grid, industrial Internet, UHV, data center, information security and other fields in new infrastructure..
Fixed income market: no matter from the perspective of coordinating with steady growth or preventing real estate debt risk, it is expected that monetary policy will at least maintain a relatively loose environment, and the risk of obvious adjustment of yield is relatively controllable. However, the further rise of subsequent bonds may need to see the fulfillment of the expectation of interest rate reduction, but we tend to think that it is difficult to reduce interest rate through game. With the development of other policies, The stabilization of fundamentals in the future is expected to be unfavorable to bonds. Further considering that the 10-year Treasury bond yield drops below 2.9% after the RRR reduction, and the cost performance of long bonds is low, it is suggested that the duration strategy is neutral and cautious.
