Strategy outlook for the second quarter: the first quarter report may become 1
Under the disturbance of the epidemic, the path of profit. China’s new round of epidemic may have a significant impact on the economy after February. In addition to the consumer industries most directly affected by the epidemic, the current durable consumer goods sales and meso industry data also show significant pressure. Although the policy has been relaxed, the actual support for the economy still needs to wait until after the epidemic. Therefore, it is expected that the economic data in the second quarter may face greater pressure. From the perspective of profitability, the first quarter may still be the relative high point of the whole year, and the profit growth rate may continue to decline after the second quarter.
Differences between macro and micro liquidity. China’s macro liquidity is expected to continue to be loose, and the restrictions of overseas tightening on China are not very obvious. However, compared with macro liquidity, the change of micro liquidity in financial markets is more worrying. Overseas scale reduction may bring greater uncertainty to the liquidity of short-term financial markets, while the continued downturn in the issuance of Chinese funds and due redemptions may put pressure on the liquidity of the stock market in the second quarter.
Risk appetite is expected to gradually repair. From the past situation, the impact of the fluctuation risk of China US relations on A-Shares is much greater than the conflict between Russia and Ukraine. Therefore, the meeting of the heads of state of China and the United States may improve the medium-term risk appetite of the market, and China’s policies are more positive as a whole under the tone set by the national Standing Committee.
Market view: the first quarterly report may become a watershed in the market. The market may have a relatively positive performance in April. On the one hand, quarterly results are still the supporting factor of the market, on the other hand, policies and other factors will also promote the repair of risk appetite. However, after the first quarterly report, the market may face some downward pressure. Under the downward pressure of profits, it is difficult for the market to have a positive performance, and the inflection point may not appear until the bottom of the economy. The upward opportunity comes from the improvement of risk appetite brought by the easing of China US relations.
Focus on the direction that is expected to exceed expectations. The short-term quarterly report exceeds the expectation, and individual stocks may have a good performance. In the medium term, pay attention to the industries that are expected to exceed the expectation. According to our two-dimensional model of industry exceeding expectations, it is recommended to choose stable industries in the period of economic downturn. We recommend two main lines: steady growth (building, building materials, real estate, real estate chain, etc.) and consumption (Baijiu, medicine, household appliances, retail, etc.).
Risk tip: the economic growth is less than expected, and the fluctuation of China US relations suppresses the market risk preference; The covid-19 epidemic has deteriorated significantly. Market watershed
