March 23 Shenwan Hongyuan Group Co.Ltd(000166) · 2022 capital market spring strategy meeting was held online Shenwan Hongyuan Group Co.Ltd(000166) a-share strategy chief analyst Fu Jingtao said in the strategy sharing that A-share is ushering in a large band bottom area. The big bottom corresponds to big opportunities, but the process of getting out of the bottom is often tortuous. At this time, we should keep an ordinary mind: objectively understand the problems faced by the medium and short-term market, but also maintain a positive attitude and make good reserves.
For investment and financial management, Fu Jingtao believes that the great development of equity products for three consecutive years will inevitably have a consolidation period. Since 2010, the public offering industry has always adhered to its position in the new economy and advanced and retreated together with China’s economic transformation. The result is “making big money and losing small money”. Therefore, in the face of a small year, you might as well be more calm.
macroscopically, Qin Tai, chief analyst of Shenwan Hongyuan Group Co.Ltd(000166) macroscopically, predicts that the economy will show the characteristics of trend stabilization from the second quarter
global commodity consumption demand gap will still drive China’s export growth
\u3000\u3000 “The world has ushered in major changes with different paths but superimposed over time, which constantly reminds us that the industrial security from energy supply to industrial chain integrity, the domestic demand security from real estate to consumption, the financial security from the steady growth of infrastructure investment to the efficient and sustainable use of financial resources, and the international financial security from the moderate stimulation of monetary policy to the maintenance of basic equilibrium of exchange rate will become the core main line of China’s stable and long-term economic development from the medium-term perspective. The core logic of safety first also means that economic policies must make a precise balance between stimulating short-term growth and avoiding the risk of long-term imbalance. ” Qin Tai said in the sharing.
Qin Tai believes that the macro economy needs to pay attention to three aspects. First, the developed countries are deeply stuck in the quagmire of stagflation. The “Dunkirk” of the industrial chain calls for the tightening “Normandy” of the Federal Reserve. The huge gap in global commodity consumption demand will still drive the high growth of China’s exports this year. China’s export forecast for the whole year will be significantly revised, and the driving force of steady growth driven by external demand may be stronger than market expectations.
Qin Tai believes that the huge gap in U.S. commodity demand and the formed “wage inflation spiral” will form a sustained and strong pull on China’s annual export growth, and the obvious weakening of export momentum may not appear until 22q4. We have significantly revised the year-on-year growth forecast of China’s exports to 15%, which means that the driving effect of net exports of goods and services on economic growth may reach 0.8 percentage points, With the strong toughness of the industrial chain, China may get another year of foreign demand to drive the key time.
Second, fiscal expenditure has been more active, but safer defensive measures have been taken. Tax cuts and rebates have focused on stabilizing employment and residents’ income, rather than directly stimulating commodity consumption demand; The escalation of the epidemic and prevention and control, as well as the low enthusiasm of residents for house purchase, have made service consumption worse, but fiscal expenditure can still form a stable growth effect slightly better than last year through government consumption, and the growth forecast of residents’ consumption of goods and services is revised. The year-on-year growth forecast of the total retail sales of social consumer goods in the whole year was lowered to 5.0%, and the final consumption is expected to contribute 2.7 percentage points of the annual growth.
Third, the real estate construction and installation investment can be supported, because the city needs to seek a stable future. We will strengthen performance orientation and ensure steady growth in infrastructure, with moderate but not excessive growth. The monetary policy of “increasing quantity without reducing price” has the neutrality of temperature.
Qin Tai believes that the differentiated real estate market needs to stabilize the total demand. Because the effect of urban policy implementation may be better than the total stimulation means such as interest rate reduction, the government work report also conveys this clear direction, and looks forward to the further implementation of stable and reasonable policies under the framework of urban policy implementation. The constraint of infrastructure investment lies not in financing, but in the firm requirement of “strengthening performance orientation”. The steady growth of infrastructure investment is moderate but not excessive. It is expected that the growth rate of narrow infrastructure in the whole year will be maintained at 3.0%. The draft budget has a positive attitude towards solving the funding gap of renewable energy power generation subsidies. Public utility investment may drive the growth rate of full caliber infrastructure investment in the whole year to be about 6.0%.
Real estate, the rate of interest reduction is difficult to solve the housing difficulties, once the sharp cut in interest rates, a second tier city improvement, investment demand will quickly promote a new round of bubble, and the three or four tier city will be a second line just need to buy the siphon effect, selling pressure further increased, the real estate market systemic risk is actually improved. The profits handed over by the central bank increased the supply of trillion yuan of base money, significantly reducing the need for RRR reduction during the year. It is expected that the annual fixed asset investment will increase by 5.0% year-on-year, and the annual capital formation will contribute about 1.8 percentage points to the year-on-year growth of real GDP.
A-Shares are at the bottom of the large band
“In the first quarter, many negative factors superimposed and the market adjusted deeply. The long-term cost performance of the market low in mid March can be compared with several historical bottoms. We are ushering in a large band bottom area, and we should keep an even mind at this time,” Fu Jingtao said in his share.
Fu Jingtao said that the big bottom corresponds to big opportunities, but the process of getting out of the bottom is often tortuous. At this time, we should keep an ordinary mind: objectively understand the problems faced by the medium and short-term market, but also maintain a positive attitude and make good reserves. This kind of reserve includes preset conditions to trigger rebound / reversal, and study the styles, industries and individual stocks that may have opportunities in the future. Of course, the physical and mental state also needs to be reserved. In addition, after the crash, we should talk less about empty long-term problems and extreme short-term emotional venting, and pay more attention to marginal changes, especially bottom-up changes.
For corporate profits, Fu Jingtao said that the year-on-year prediction of the parent net profit of all a and non A in 2022 is – 4.7%. In terms of rhythm, it will go down first and then grind the bottom. The effect of steady growth is reflected in the performance of a shares, which may have to wait until the fourth quarter of 2022. If the similar stagflation pattern continues, the manufacturing profitability of the midstream may face further significant downward revision.
Fu Jingtao said that A-Shares have been “bathed in fire” and are waiting for “rebirth”: the market still needs to grind the bottom in the second quarter, and the possibility of negative decline is not ruled out. The total amount and structure of fundamentals lack bright spots, and the event shocks are repeated. In the second quarter, technology and consumption may usher in left layout opportunities.
The opportunity for the overall recovery of the market will begin in the third quarter. At that time, the easing effect will appear, the highlights of the fundamentals of the new economy will increase, and the profits of enterprises may improve. Meanwhile, the Fed’s tightening expectations may loosen.
“2022 may not be a bear market in the end, but it is still recommended to be patient in the second quarter.” Fu Jingtao said
In terms of specific sectors, Fu Jingtao believes that in the industry with the first public offering position in the fourth quarter of last year, the time for the relative return of power equipment to lose will usually exceed the decline of absolute return, and there is a new main line in the probability at the initial stage of market reversal; The growth rate and profitability may fall significantly in two quarters.
“After the adjustment of the industry that ranks first in raising positions, most of the new main lines will appear in the direction of other public offering positions. If the new economic boom does not appear in time, the economic bottom may drive the pro cyclical undervaluation to become the new main line.” Fu Jingtao said that he focused on medium-term opportunities in the sub sectors of price rise consumption, digital economy, electronics and medicine.
If the new economic boom does not appear in time, the “economic bottom” may drive the pro cyclical undervaluation to become a new main line, focusing on investment opportunities in real estate and coal.
