China’s epidemic spread in many places, and the main stock indexes fell collectively: as of March 25, the Shanghai Composite Index closed at 321224 points, down 7.22% from the end of February. In February, the social finance data was less than expected, the demand of the real economy was insufficient, the epidemic rebounded in many places in March, and the market pessimistic expectations fermented. In the first ten days of March, A-Shares showed a sharp downward trend. Market sentiment improved after the golden stability meeting held in late March. In terms of sub structure, the main stock indexes of A-Shares fell collectively, and the performance of SSE 50 was relatively strong, falling 7.28% in the current month. The CSI 500, CSI 300 and gem index fell by 8.54%, 8.88% and 8.45% respectively. Kechuang 50 fell the most, down 11.42% in the same month, a record low.
The high volatility of the global financial market has weakened, and investor sentiment has warmed up: the situation in Russia and Ukraine has eased, and the impact on the financial market has weakened. However, in the field of bulk commodities, the prices of major industrial products still fluctuate sharply, and attention should be paid to the disturbance of price increase to the industrial chain. In addition, the market risk appetite rebounded after the Fed raised interest rates. At the current time point, we should pay attention to the statements of Fed officials before the interest rate meeting in May. If there is a faster interest rate increase and table reduction arrangement, it will have an impact on the market.
The pressure on China’s economic growth is still great, and the main line of “steady growth” continues to the second quarter: the epidemic is rising in many parts of the country, which has a negative impact on economic production in the short term, and the pressure on “steady growth” is still great. It is expected that the policy on the demand side will continue to work, and the policy tone of “steady growth” will continue until the actual economic data improve. Corresponding to the capital market, the main line of “steady growth” investment will continue to the second quarter.
The listed companies that actively disclosed the operating conditions from January to February had strong strength: as of March 22, 84.0% of the 81 companies that disclosed their performance had improved their profits. Although the overall performance of the A-share market from January to February was poor, the fundamentals of the operation of strong listed companies have not changed, and the first quarter report is expected to have a bright performance. From the perspective of industry distribution: 1) benefiting from the rise in the price of bulk commodity raw materials, the performance of non-ferrous metals, iron and steel, basic chemical and other industries in the upstream industry ranks high; 2) The fundamentals of relevant industries in the new energy industry chain continued to improve; 3) The domestic substitution process of high-tech products has accelerated. At the same time, the “intelligent” and “digital” application market is broad, the demand for semiconductors continues to be strong, and the business performance of the electronic industry has increased significantly; 4) Under the influence of covid-19 epidemic, vaccines, testing reagents, oral drug research and development, the revenue and profit of relevant pharmaceutical and biological enterprises have improved significantly; 5) the main line of price increase is smooth, and the food and beverage industry represented by Baijiu still maintains a higher profit level.
General trend research and judgment and industry configuration suggestions:
Looking forward to April, the impact of overseas fluctuations on the A-share market is expected to weaken. China’s first quarter economic data will be released soon, and the disclosure of enterprise annual reports is coming to an end. Combined with the operation from January to February, the industry leaders with performance support are in an advantageous position. It is expected that the macro liquidity will remain stable, the liquidity of the A-share market will be worry free, and the pressure of foreign capital outflow will be reduced. With the warming of market expectations, risk appetite is expected to improve, and pay attention to the sectors with upward prosperity. In terms of industry allocation, 1) at present, China’s economic growth pressure is still large. Both the “two sessions” and the golden stability meeting regard “stable growth” as the primary task. Some companies have disclosed the performance from January to February, and the relevant sectors of “steady growth” have performed well, and the main line allocation idea continues; 2) With the recovery of market sentiment, the prosperity of the growth sector rebounded, focusing on the rebound opportunities in semiconductor, artificial intelligence, new materials, cloud computing and other fields.
Risk factors: increased geopolitical risks; The epidemic situation worsened; The economy fell more than expected.
