Event:
Yesterday, Russia and Ukraine completed a new round of face-to-face negotiations in Istanbul, Turkey. This negotiation is the most progressive negotiation so far. The two sides reached agreement on some issues.
Key investment points:
The rebound of A-Shares continued, and the pressure of high commodity prices continued
We believe that the Russian Ukrainian issue is only the fuse of the low sentiment of the A-share market, not the core factor leading the rise and fall of A-shares. In other words, the easing of the conflict between Russia and Ukraine will not directly promote the sustained rebound of a shares. The main driving force of the rebound in the A-share market is more from the lower valuation level, independent and controllable, the driving force of scientific and technological innovation and brighter export data. Therefore, we are optimistic about the current market to June. From the perspective of sectors, due to the long-standing problems in China US relations, we are optimistic about the independent and controllable sectors and the undervalued sectors.
For the bulk market, the sanctions against Russia may not end with the easing of Russia and Ukraine, so the pressure of high commodity prices will continue. We reiterate that we are optimistic about soybeans, wheat and other Shenzhen Agricultural Products Group Co.Ltd(000061) . The impact of the Russian Ukrainian conflict and the rise in nitrogen fertilizer prices on spring farming in some regions will be gradually reflected in the next half of the year. At the same time, we maintain our judgment on the high operation of Brent oil price and the possible sharp fluctuation of WTI oil price.
The factors of severe market shock in the early stage showed marginal improvement, and the quantitative perspective also supported the continuation of the rebound
The reasons for the sharp fluctuations in the early market outside China: 1) the debt problem of Chinese real estate enterprises; 2) The impact of the epidemic on China's consumption capacity; 3) Russia Ukraine conflict intensifies global inflation expectations; 4) The valuation correction pressure under the Fed's expectation of raising interest rates, the above four factors are marginally positive.
From the quantitative perspective, the implied volatility surface data of options show that the turning of market sentiment into negative began in December, peaked at the end of February when Russia Ukraine conflict, and then there was marginal improvement. The rebound continued to improve, but it has not yet reached the reversal point. There is still room for continuous improvement before June.
Risk tips
Repeated outbreaks; Intensifying geopolitical conflicts; The economic recovery is less than expected; The steady growth policy was less than expected.
