One week Perspective
This week, the Fed hinted at accelerating tightening, but it will not restrict China's maintenance of a loose environment. This week, the Federal Reserve released the minutes of the FOMC meeting in March, releasing a strong "Eagle" signal, driving a sharp correction in the US stock technology growth sector. The NASDAQ index dominated by technology stocks fell 3.86% and the US dollar index strengthened, rising 1.29% week, approaching the 100 mark. At the same time, this week, the three countries will once again strengthen the signal of steady growth, and China's overweight easing expectation remains unchanged. Affected by the epidemic in China, the PMI of Caixin service industry fell sharply to 42.0 in March, the lowest since March 2020, and the PMI of manufacturing industry recorded 48.1, which also fell below the dry and prosperous line. The pressure on China's steady growth has intensified, and it is expected to further reduce interest rates and reserve requirements. Thus, the trend of China US policy cycle difference has been further clarified, and the pattern of external tightening and internal loosening has been further deepened. At present, the epidemic situation in China is still severe, the logistics, production and consumption sides have been significantly impacted, the probability of the conflict between Russia and Ukraine continues to seesaw, and global inflation will remain high and difficult to slow down in the short term.
The A-share market was impacted by the dual emotions of overseas tightening and China's epidemic situation, and there was a significant correction, and the main broad-based indexes ended lower. The style and sector differentiation continued. The performance of large cap stocks was still relatively better than that of small and medium cap stocks. The stability and financial style were better than that of consumption and growth. The performance of relevant sectors in the real estate industry chain was strong. The middle and lower reaches of consumption, TMT and other sectors were significantly impacted by the negative impact of the epidemic and fell sharply. At present, we believe that the current market is facing multiple uncertainties. Under the background of complex macro environment at home and abroad, it is suggested to focus on large cap value stocks to resist risks and fluctuations. At the same time, the main line of steady growth has become increasingly clear and began to be sought after by funds. Northward funds and main funds are overweight in real estate, basic chemical and other sectors. In the short term, the stable growth industrial chain, which is expected to be boosted by precise policies, overweight and easing, and the upstream sector under the sustained global high inflation may show better performance. In the medium and long term, the current major indexes are at historically low levels and have better cost performance. We will continue to pay attention to the boom inflection point of downstream consumption and growth after adjustment and grasp structural opportunities.
