Key investment points:
Yang Jiechi will hold a meeting with Sullivan, assistant to the US president for national security affairs, in Rome
According to the website of the Chinese Ministry of foreign affairs, foreign ministry spokesman Zhao Lijian announced: as agreed by China and the United States, Yang Jiechi, member of the Political Bureau of the CPC Central Committee and director of the office of the Central Foreign Affairs Working Committee, will meet with Sullivan, assistant to the president of the United States for national security affairs, in Rome, Italy, on March 14 to exchange views on China US relations and international and regional issues of common concern.
Overall, the focus of this meeting is to implement the important consensus reached at the video meeting between the heads of state of China and the United States last November. The two sides have been in contact with this matter since the end of last year, and have been meeting to maintain communication, and the meeting time has been determined according to the agenda of the two sides. The two sides will exchange views on China US relations and international and regional issues of common concern.
The increment of social finance is slightly weaker than that of seasonality
On March 11, the central bank released financial data for February. In February, M2 increased by 9.2% year-on-year. In February, the increment of social financing scale was 1.19 trillion yuan, an increase of 531.5 billion yuan less than the same period last year. In February, RMB loans increased by 1.23 trillion yuan, a year-on-year decrease of 125.8 billion yuan. The increment of social finance and credit scale are slightly lower than market expectations. The growth rate of M2 has decreased. At the end of February, broad money M2 increased by 9.2% year-on-year, 0.6 and 0.9 percentage points lower than that at the end of last month and the same period of last year, partly due to the high base in the same period of last year and the weak demand for credit financing in February. In terms of specific structure, fiscal deposits increased by 600.2 billion yuan, an increase of 1.4 trillion yuan year-on-year, indicating that fiscal expenditure still needs to be strengthened; Household deposits decreased by 292.3 billion yuan, an increase of 3.5 trillion yuan year-on-year. Narrow money M1 increased by 4.7% year-on-year, from negative to positive compared with the previous month, slightly better than expected. The scissors difference between the year-on-year growth rate of M2 and M1 fell to 4.5% from 11.7% last month.
The growth rate of social finance increment and stock was slightly weaker than expected. In February, the increment of social financing scale was 1.19 trillion yuan, an increase of 531.5 billion yuan less than the same period last year, and the new value-added decreased by 4.98 trillion yuan compared with the previous month, which is weaker than the seasonality as a whole. At the end of February, the stock of social financing scale increased by 10.2% year-on-year, down 0.3 percentage points from the previous month, but it was still higher than 10% for four consecutive months. In terms of structure, corporate debt financing and government debt financing under the scope of social finance increased year-on-year, becoming the main contribution to the increment of social finance in February; RMB loans and off balance sheet non-standard items increased less year-on-year, which was a drag. However, combined with the data from January to February, the total social financing increment in the first two months of this year was 7.36 trillion yuan, an increase of 449.9 billion yuan year-on-year compared with the same period last year (6.9 trillion yuan). Therefore, combined with the two-month data, it is not too pessimistic.
Credit data were also lower than expected, dragging down the formation of medium and long-term loans for residents. In February, RMB loans increased by 1.23 trillion yuan, a year-on-year decrease of 125.8 billion yuan. In terms of sub sectors, residents’ loans decreased by 336.9 billion yuan, including short-term loans decreased by 291.1 billion yuan and medium and long-term loans decreased by 45.9 billion yuan, which is also the first net repayment of residents’ medium and long-term loans in recent two years. In February 2020, residents’ medium and long-term loans were – 413.3 billion yuan, which was also a negative value. Combined with the data of commercial housing transaction area in 30 large and medium-sized cities, 2.9 million square meters and 6.62 million square meters were sold in February 2020 and February 2022 respectively, which is also the only two months in which the transaction area in a single month is less than 10 million square meters in recent three years. The main reason behind this is the fermentation of China’s epidemic situation and the weak real estate sales due to factors such as the Spring Festival holiday.
Overall, we believe that the lower than expected social finance in February is mainly due to the credit demand for a “good start” under the “steady growth” of a slight overdraft in January. The continuous superposition of seasonal factors in February led to weak demand for the real economy, and the new RMB loans and off balance sheet financing decreased significantly. The real estate sales end is still weak, but it is expected that with the recovery of financing policy, the real estate is expected to gradually step out of the bottom. On the whole, we believe that the effective demand of the real economy behind social finance in February is still insufficient, but according to the data of January and February, the increment of social finance did not increase less year-on-year. The year-on-year growth rate of superimposed social finance stock has also rebounded steadily since 10% at the end of October 2021. We don’t think we need to be too pessimistic. Under the demand of “stable economic growth”, there may be a possibility of interest rate reduction in monetary policy, and the subsequent social finance may be expected to pick up.
Ukrainian Negotiator: Ukraine and Russia are tending to reach a compromise on signing a comprehensive and comprehensive agreement
According to China Central Television News, on the 12th local time, podoliyak, a member of the Ukrainian delegation to the Russian Ukrainian negotiations and the director of the Ukrainian presidential office, said in an interview that after the third round of negotiations between Ukraine and Russia, the two sides carried out a series of communication by video and established a working group. At present, the two sides are close to reaching a compromise on signing relevant agreements.
Podoliyak said that Ukraine and Russia have put forward a variety of proposals to resolve the conflict. For the Ukrainian side, the agreement to be signed should include principled positions such as the ceasefire between the two sides, the withdrawal of Russian troops, the signing of a peace agreement and the repair of damaged infrastructure in Ukraine. The most important thing is to ensure the security of Ukraine to avoid the recurrence of similar incidents. Podoliyak pointed out that Ukraine and Russia will be committed to signing a comprehensive and comprehensive agreement. At present, the working group is studying relevant schemes and discussing them at the legal level to form a text. The final text of the agreement will be signed by the presidents of the two countries.
Overall, the period of the biggest conflict between the two sides may have passed, and it is expected that the impact of subsequent geopolitical conflict factors on the global capital market may be slightly weakened.
National Health Commission: residents can buy reagents to self test covid-19 virus
In March 11th, according to the National Health Protection Committee, the State Council, in response to the comprehensive unit of the joint prevention and control mechanism of New Coronavirus pneumonia, decided to increase the antigen detection on the basis of nucleic acid detection, and formulated the “COVID-19 virus antigen detection application plan (Trial Implementation)”.
The scheme specifies the applicable population for antigen testing:
First, those who go to grass-roots medical and health institutions with respiratory tract, fever and other symptoms within 5 days;
Second, isolate observers, including those in home isolation observation, close connection and secondary close connection, entry isolation observation, sealing and control area and control area;
Third, community residents who need antigen self-test.
At the same time, the main conditions to be met for antigen detection of the three groups and the access to detection reagents were clarified, and the disposal management process after positive detection was formulated to promote the connection between antigen detection and nucleic acid detection. In order to facilitate standardized testing in various regions, the plan also includes two annexes, namely, the basic requirements and procedures for covid-19 virus antigen testing in grass-roots medical and health institutions, and the basic requirements and procedures for covid-19 virus antigen self-testing. In general, antigen detection, as a supplement to nucleic acid detection, is more convenient and faster. It is generally used in the early stage of infection, but its accuracy is not as good as nucleic acid detection. The whole is conducive to promoting the monitoring mode of “antigen screening and nucleic acid diagnosis” and benefiting relevant sectors.
Financing funds
On March 11, the balance of A-share financing was 161336 billion yuan, a month on month decrease of 6.116 billion yuan; The balance of margin trading was 1707352 billion yuan, a decrease of 4.955 billion yuan month on month. The balance of financing minus securities lending was 1519368 billion yuan, a month on month decrease of 7.277 billion yuan.
Land stock connect and Hong Kong stock connect
On March 11, the net purchase transaction of land stock connect on that day was -5.042 billion yuan, including 53.620 billion yuan of purchase transaction and 58.662 billion yuan of sales transaction, with a cumulative net purchase transaction of 162239 billion yuan.
Hong Kong stock connect had a net purchase transaction of HK $3.818 billion on the same day, including a purchase transaction of HK $25.843 billion and a sale transaction of HK $22.024 billion, with a cumulative net purchase transaction of HK $2257042 billion.
Money market
On March 11, Bank Of Shanghai Co.Ltd(601229) inter-bank offered rate Shibor overnight interest rate was 2.0510%, up 2.60bp, Shibor one week was 2.1020%, up 2.00bp. The weighted interest rate of pledged repo of deposit institutions was 2.0343% overnight, up 0.54bp and 2.1035% a week, up 2.83bp. The 10-year maturity yield of China national debt was 2.7902%, down 6.00bp.
Overseas stock market
On March 11, the Dow Jones Industrial Average closed at 3294419 points, down 0.69%; The S & P 500 index closed at 420431 points, down 1.30%; The NASDAQ index closed at 1284381, down 2.18%. European stock market, French CAC index closed at 626025 points, up 0.85%; Germany’s DAX index closed at 1362811 points, up 1.42%; The FTSE 100 index closed at 715564, up 0.80%. In the Asia Pacific market, the Nikkei index closed at 2516278 points, down 2.05%; The Hang Seng Index closed at 2055379, down 1.61%.
Foreign exchange rate
On March 11, the dollar index rose 0.63% to 991329. The euro fell 0.60% against the dollar to 1.0939. The dollar rose 0.92% against the yen to 1171232. The pound fell 0.37% against the dollar to 1.3062. The spot exchange rate of RMB against the US dollar closed at 6.3228, depreciating by 0.02%. The spot exchange rate of offshore RMB against the US dollar closed at 6.3283, depreciating by 0.08%. The central parity rate of RMB against the US dollar closed at 6.3306, depreciating by 0.32%.
Gold, crude oil
On March 11, Comex gold futures fell 0.48% to close at US $199230/oz. WTI crude oil futures rose 3.06% to close at US $109.09/barrel. Brent crude oil futures rose 2.69% to close at US $112.12/barrel. COMEX futures rose 40.0% to close at 31.514 pounds. LME copper three-month futures fell 0.29% to close at US $10101 / ton.
