Ping An View:
The global stock market fell across the board, and the Hong Kong stock market continued to decline. Global stock markets generally fell last week, and the decline in developed markets was even greater. Among developed markets, the French stock index fell the most, with a weekly rise and fall of - 10.23%; Among emerging markets, the Russian stock index was closed, while the Indian stock index fell the most, with a weekly rise and fall of - 2.73%; The Hong Kong stock market represented by the Hang Seng index continued to decline, with weekly gains and losses of - 3.79%.
The Hong Kong stock industry fell more or rose less, and the energy industry outshined others. Last week, the Hong Kong stock industry sector fell more or rose less. As the only sector that rose last week, the energy industry rose or fell by 6.65% on a weekly basis; The non essential consumption industry fell the most, with a weekly rise and fall of - 7.56%; The medical and health care industry, information technology industry, industry, financial industry and essential consumer industry all fell to varying degrees.
The Hang Seng index is close to the bottom of the epidemic, and its rebound may be expected. The overseas geopolitical situation that broke out in February has intensified in early March. This also led to the continuous decline of Hang Seng Index, Hang Seng technology and other indexes, which is only one step away from the end of the epidemic in March 2020. The increasingly complex geographical situation overseas makes the Hong Kong stock market in a "dark valley", but looking for a little star can bring hope. We believe that there are three factors that will support the performance of the Hong Kong stock market in March. First, the downside space of Hong Kong stocks is extremely limited. At present, the rapid release of risks is conducive to the faster arrival of the bottom. The downward valuation of Hong Kong stocks is significantly greater than the upward valuation of Hong Kong stocks from the perspective of absolute reserve. Second, after the Fed released the signal of rapid interest rate increase in the long term, the non-agricultural data in February showed the easing of wage growth, which may indicate that the inflection point of inflation may move forward, and the expectation of the Fed's long-term tightening may also slow down in the future. Third, after China's two sessions, a series of policies for steady growth are promising, and the Hong Kong stock market is also expected to welcome the spring breeze of policies. With the support of the above three points, the rebound of Hong Kong stocks may not be far away.
The advantages of the cyclical sector are prominent, and the upward trend of international inflation is not over. Although the wage growth in the US non farm data may ease long-term inflation expectations, there is still plenty of action on inflation in the recent period. Whether it is the surge of energy, nonferrous metals and Shenzhen Agricultural Products Group Co.Ltd(000061) after the impact of supply gap under the warming situation in Russia and Ukraine, or the background factor in the process of global supply chain repair, from upstream raw materials, midstream manufactured goods to downstream consumer goods, they are facing greater price rising momentum, which also leads to the continuous strength of the cyclical raw materials sector in the equity market, The cycle sector has also become the "most beautiful boy" in the recent Hong Kong stock market. When the momentum of global inflation remains abundant in the near future, the strength of the cyclical sector may continue for some time until the geopolitical situation eases significantly.
In the short term, we will continue to focus on cycle and marginal consumption, and in the medium and long term, we will focus on three directions. In view of the consideration that the upward trend of global inflation will continue in the short term, Hong Kong stock cycle and marginal consumption are still the key areas we recommend to focus on. However, with the convening of the two sessions and the continuous promotion of steady growth policies, the layout of the medium and long-term line also needs to be followed up. The medium and long-term line focuses on three directions: new infrastructure with prosperity first, high-end manufacturing and green industries supported by policies, and the dilemma reversal of financial real estate and Internet technology.
Risk tips: 1) covid-19 epidemic further increases the impact; 2) The global fiscal stimulus is less than expected or the monetary tightening is faster than expected; 3) The macroeconomic recovery is less than expected; 4) Overseas market volatility intensified.
