In the context of the sharp decline in global stock markets, a share capital suffered three consecutive declines this week. On March 9, it fell 1.13% to close at 325639. It once fell below 3200 points, with a cumulative decline of 5.55% so far this week. This week, the net capital outflow from the North reached 27.904 billion yuan.
According to datayes, the top stocks sold by Hong Kong capital on the 8th were Ping An Insurance (Group) Company Of China Ltd(601318) , China Merchants Bank Co.Ltd(600036) , Will Semiconductor Co.Ltd.Shanghai(603501) , Citic Securities Company Limited(600030) , Industrial Bank Co.Ltd(601166) , Kweichow Moutai Co.Ltd(600519) , Longi Green Energy Technology Co.Ltd(601012) . According to the statistics of choice, the industries with the highest market value of northbound capital holdings in the past five days are power supply equipment, precious metals, construction, rare metals, electric power, metal and non-metallic new materials, etc. A number of international asset management institutions told reporters that the tightening of the Federal Reserve is imminent, coupled with the deterioration of the situation in Ukraine, the funds previously flowing to emerging markets tend to return, and the institutions are more inclined to adopt a partial defense strategy for the time being.
“In February this year, foreign investors turned to net selling of a shares. The bond inflow in January was strong (US $10.3 billion in January), but in February, international investors became net sellers (the outflow reached a record high), which was mainly affected by rising geopolitical risks,” Zhang Meng, a macro and foreign exchange strategist at Barclays, told China business news However, in view of the large short-term decline, the agency believes that a rebound cannot be ruled out in the short term. On the 9th, Germany’s DAX30 index rebounded by more than 6%, and US stocks opened up by 2%.
global risk aversion
Recently, commodities soared, US stocks plummeted and US bond yields fell sharply. The current market situation seems to be similar to the “formula” before the outbreak of the financial crisis in 2008.
At present, bulk commodities have doubled. On March 8, Brent crude oil once approached us $130, rising by more than 10% within the day; Dutch natural gas futures, the benchmark of continental Europe, rose nearly 80% in the day, and lunni rose more than 70%; The yield of 10-year US bonds fell back to around 1.78% from 2.065% in February. On March 9, the Asian market continued to sell. The Shanghai composite index once fell below 3200 and exceeded 2% at the highest. Under the risk aversion, the dollar index is about to break 100. As of 17:40 Beijing time on March 8, the US dollar index reported 99.10, and fell slightly to around 98.7 on March 9.
\u3000\u3000 “U.S. stocks are still relatively operating at historic highs, interest rates are at historic lows, U.S. Treasury bond yields have fallen sharply due to the situation in Russia and Ukraine, and commodity prices have risen sharply. In the past decade, such things have happened twice. One was in the first half of 2008 and the other was in the first half of 2011. There was a financial crisis in 2008 and a European debt crisis in 2011. The difference is In 2008, the Fed still had room to operate interest rates, but now it has no room in the face of surging inflation. ” Si tujie, partner of Qingxi capital and senior US stock trader, told reporters.
At present, the market is worried that high energy prices may lead to a gradual global recession, which further dragged down sentiment. On August, President Biden announced that the import of liquefied natural gas from Russia had been banned for 45 days. On the same day, the UK also announced plans to stop importing Russian crude oil and petroleum products by the end of 2022. The market is worried that more countries will join the ranks of banning Russian oil imports.
\u3000\u3000 “Due to the relatively low dependence of the United States and the United Kingdom on Russian oil, the ban on the import of Russian crude oil and petroleum products is more symbolic. If the European continent joins it, it is difficult to find alternatives in the market due to OPEC + restrictions, insufficient production capacity and limited export capacity of American crude oil, and the global oil market will be in an extremely tight supply situation. I We expect that the price of the main contract of Brent futures may exceed the record high of $146 on July 3, 2008. ” Fu Xiao, head of commodity market strategy of BOC International, told reporters.
If the inflation train continues to get out of control, traders will be increasingly worried about the possibility of the Federal Reserve raising interest rates by 50bp at its meeting on March 17. Once traders predict that the Fed will raise interest rates by 50bp instead of 25bp in March, market volatility may accelerate and amplify. Major Wall Street banks generally expect the Federal Reserve to raise interest rates 6-7 times this year, and announced at the June meeting that it will begin to reduce its balance sheet. It is expected that the monthly reduction caps of US Treasury bonds and MBS will be US $60 billion and US $40 billion respectively, which will reduce the balance sheet to the final balance scale in 2-2.5 years.
northbound funds converted to net outflow
On the 9th, the sharp sell-off of more than 10 billion yuan from the North attracted attention. From experience, when the global geopolitical risk intensifies, the performance of the Chinese market tends to be better, because Chinese companies are dominated by Chinese income (only 8% of the income comes from overseas), and the shareholding proportion of foreign capital in A-Shares is still relatively limited. Therefore, the market once believed that A-Shares should usher in capital inflows and become a “safe haven”.
However, Goldman Sachs also mentioned earlier that with the doubling of Sino Russian trade volume in the past five years and the steady increase of foreign investors’ participation in China’s stock market, market volatility is still inevitable to intensify, so investors need to be more targeted in the layout.
At the end of February, while the global stock market sold off, the risk appetite of China’s stock market had decreased significantly. The above-mentioned institutions said that first, the correlation of cross industry returns has reached a five-month high, indicating that macro risks have replaced micro factors as the main driving factor of the stock market; In addition, the inflow of northbound funds was strong at the beginning of this year, but it has turned into a net outflow in the last week (from the end of February). Two weeks ago, Goldman Sachs’s offshore China market risk Barometer (ERB) fell sharply to the negative region.
Gao Ting, head of Nomura Oriental International Research Department, previously told reporters that when the overseas market sentiment is optimistic and the risk appetite is high, it will often bring relatively abundant funds into a shares, because the emerging market is a high-risk market in the hearts of international investors. In 2021, central banks around the world released a lot of liquidity, and US stocks increased by nearly 20%. The net inflow of northward funds in the whole year also exceeded a record high of 400 billion yuan. However, in 2022, the above supporting factors will subside. In addition to geopolitical factors, the central bank dominated by the Federal Reserve will start to raise interest rates, and liquidity is facing contraction.
However, the stability of the RMB also helps to avoid further deterioration of stock market sentiment, which is contrary to the negative situation in 2015 and 2018. Under the strong export growth and limited capital outflow, “we expect the rise of RMB to continue in the short term. It is expected that the US dollar / RMB will test 6.3 in the near future, and the RMB CFETS basket index will rise to 108.”
short term or current rebound
After the sharp decline, most institutions believe that they do not rule out a rebound in short-term A shares.
Wu Zhaoyin, macro strategy director of AVIC trust, told reporters, “The market has been thrown out of panic after continuous sharp declines. Although there is not much opportunity for the stock market from the perspective of incremental funds in the whole market, it must be a little too much for the short-term continuous sharp decline. In this case, the bottom reading funds will enter the market and rebound in the short term, but after the rebound, the market still has to rely on incremental funds and fundamentals.
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He said that at present, the short-term bad has been exhausted, and the market has fully reflected the negative factors outside China. Some positive factors such as the central bank’s payment of 1 trillion profit and the import and export data in January and February still exceed expectations will become the driving force of the market rebound. Therefore, after the continuous sharp decline of the market, the short-term should not be too pessimistic.
Zhang Zhiwei, chief economist of Baoyin capital management company, also mentioned to reporters that the stock market is too pessimistic and the fiscal policy is about to force. “The government work report puts forward that this year’s economic growth target is set at 5.5%. This is the upper limit of market expectations, indicating that the Chinese government still attaches great importance to the speed of economic growth and does not want a rapid slowdown. An important reason for the current lack of market confidence is that the path of steady growth is not clear, and some leading indicators in China, such as credit and fiscal expenditure, may be marginal Turn, this month’s PMI index has begun to rise slightly. “
Choice data also shows that at present, in addition to allocating upstream resource stocks, northbound funds are also overweight the pharmaceutical and other sectors that suffered a fall last year. Growth stocks with uncertain performance and a sharp correction in share prices have also become the focus of foreign capital allocation. In the five days of the last five days, northward funds have been added from the north in the past five days, and the sectors with the biggest market capitalization are: power equipment, precious metals, construction, rare metals, and power. The sectors with the largest market capitalization are: power equipment, precious metals, construction, rare metals, and power. The sectors with the largest market capitalization. The sectors with the largest market capitalization are: power equipment, precious metals, precious metals, construction, rare metals, electricity, etc. The stocks with the highest increase are: 3 Anhui Fuhuang Steel Structure Co.Ltd(002743) Chongqing Sansheng Industrial Co.Ltd(002742) 74274\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\014 , China Northern Rare Earth (Group) High-Tech Co.Ltd(600111) .
Throughout the year, Li Bei, the founder of Pinellia ternata investment, told reporters recently that he was relatively optimistic about the CSI 500 and short on the Shanghai 50 and Shanghai and Shenzhen 300 “Behind the CSI 500 is more industrial capital, while the CSI 300 has gathered more public funds and foreign capital. The sales of public funds this year is less than 1 / 10 of that of the same period last year. Under the background of overseas austerity, the net inflow rate of foreign capital is probably less than that of last year.”
