Key investment points:
After the index of the banking sector rose steadily this week (2.28-3.4), it weakened significantly on Friday. As of the last trading day of this week, the price to book ratio was lf0.5% 64pb, the valuation is almost the same as that at the end of last week, and the market heat has decreased. The average daily trading volume is 967.7 billion yuan (Mom – 8.8%). This week, the central bank’s wide caliber (including 7-day reverse repo) net recovery is 430 billion yuan, the 7-day reverse repo interest rate remains 2.10%, and the overall liquidity is at a good level; On Friday (March 4), it was announced that the weighted value of dr07 was 2.04%, close to the reverse repurchase level, with good overall liquidity and good conduction of interest rate guidance level.
In a troubled world and China with deep still waters, financial stability is trustworthy. This week, the valuation level of China Citic Bank Corporation Limited(601998) sector remained almost unchanged, significantly outperforming CSI 300, basically in line with the expectations at the beginning of the week. During the working day of this week, mainly affected by the fermentation of the risk event of “Russia Ukraine conflict”, the global equity market retreated sharply due to the impact of the sharp increase in the price of hedging demand and related bulk commodities (crude oil, aluminum, etc.). In the process of integration between China and other countries in the world, cooperation has exceeded “contradictions”, and China’s opening to the outside world has always become a clear vein of China’s economic development. The pressure on China caused by the rapid rise of raw material prices exists, but we think it can be solved through diversified raw material sources. In addition, China’s shipping market to other countries in the world is active, With the upgrading of manufacturing technology, the bargaining power of foreign trade enterprises is improved, and actively cooperate with foreign trade financial and credit policies, so as to stabilize the basic market of foreign trade. We believe that China’s economic development has strong toughness, large economic volume and wide extension. China’s financial stability deserves the trust of partners all over the world and Chinese enterprises of all types.
The “two sessions” sounded the strongest voice of steady economic growth, and made progress in stability through multiple approaches. Since Friday, the two sessions of the National People’s Congress and the people’s Congress have been gradually launched. Premier Li Keqiang delivered the government work report on Saturday. The report is rich in content: in the past year, even in the face of many difficulties, we have built a moderately prosperous society in an all-round way as scheduled. China’s GDP has increased by 8.1% to 114 trillion yuan year-on-year, the added value of high-tech manufacturing industry has increased by 18.2%, and the toughness of the industrial chain has improved. With the construction of one belt, one road and another, the total import and export volume of goods has increased by 21.4%, and the actual use of foreign capital has been growing. Faced with many internal and external challenges and the triple pressures of shrinking demand, supply shock and weakening expectations for economic development, China has considered the needs of stabilizing employment, ensuring people’s livelihood and preventing risks, made steady macro policies, made vigorous micro policies, unblocked the economic cycle, solidly cooperated with science and technology policies, and paid attention to the balance of regional development. In 2022, the fiscal policy will be more active, increase local transfer payments, expand effective investment, guard against financial risks, strengthen the effective financial support to the real economy and reduce the production and operation costs of enterprises. With the support of policies, we believe that the bank’s profit expectation is good, the valuation has more room to improve, and maintain the “recommended” rating.
Market performance
The banking sector index rose 0.07% this week, outperforming the market. This week, the Shanghai Composite Index fell 0.11%, the Shenzhen Component Index fell 2.93%, the gem index fell 3.75%, and the Shanghai and Shenzhen 300 index fell 1.68%. The recommendations focus on high-quality joint-stock banks ( ‘ Tsingtao Brewery Company Limited(600600) 36\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\, Bank Of Nanjing Co.Ltd(601009) , Bank Of Shanghai Co.Ltd(601229) , Shanghai Rural Commercial Bank Co.Ltd(601825) and Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) , Jiangsu Zhangjiagang Rural Commercial Bank Co.Ltd(002839) ).
Risk tips
Repeated epidemic risk, tightening monetary policy, increasing risk of non-performing rate, outbreak of major risks and events of default, etc.
