This week (from April 4 to April 8, 2022, the same below) Hang Seng Index - 0.76%. This week, the Dow Jones industrial average was - 0.28%; S & P 500 index - 1.27%; NASDAQ - 3.86%.
Recently, the communication progress between China and the United States on audit supervision has affected the China concept and Hong Kong stock market, which is one of the core factors affecting the market at present and in the future. Yi Huiman, chairman of the CSRC, said at the third member congress of the China Association of listed companies on April 9 that the CSRC will pay close attention to studying and launching a new round of independent opening-up and pragmatic measures, steadily expand the scope of Shanghai Shenzhen Hong Kong standard, accelerate the implementation of new regulations on the supervision of overseas issuance and listing of enterprises, and maintain the smooth channels of overseas listing. In accordance with the principle of "respecting international practices and abiding by Chinese laws and regulations", promote the achievements of China US audit supervision cooperation, and build a predictable international regulatory environment for the high-level opening of the capital market.
On the whole, we believe that the release of the determination of China Securities Regulatory Commission and other competent departments to adhere to the opening-up and the positive attitude of continuously deepening cross-border regulatory cooperation may have more positive significance for the agreement between China and the United States on audit supervision and contribute to the improvement of short-term market risks.
Generally speaking, we continue to pay attention to the disturbance of external macro factors, such as China US relations and the conflict between Russia and Ukraine, especially the communication progress of China US audit supervision; Internally, we pay attention to the gradual clarity and predictability of policies, and the potential impact of macroeconomic / local epidemic on the fundamentals of the company may be stabilized and improved gradually.
From the perspective of overseas markets, we believe that the risks that may be deduced in the short term include: the minutes of the March meeting released by the Federal Reserve revealed the pace of table contraction in the second quarter and in the future. It may raise interest rates by 50bps in the next time, which continues to maintain the hawkish style in the past. Compared with the previous round of table contraction cycle in 20172019, this round is significantly stronger and faster, and the yield of long-term and short-term US bonds has been inverted for many times. From the perspective of the global supply chain, the sudden epidemic still poses pressure on the production of exporting countries, so that global inflation may be difficult to alleviate in the short term under the pressure of supply shortage. From the perspective of geopolitical risks, the conflict between Russia and Ukraine is further interpreted in the market risk appetite, which may put pressure on the liquidity of emerging markets. At the same time, digital assets are expected to improve. The speech of US Treasury Secretary Yellen this week also shows that the government has further softened its attitude towards digital assets, acknowledged that it is part of the trend of "financial digitization", and the long-term development expectation of digital assets has increased. Among the technology giants, we suggest paying attention to Microsoft and Amazon, which have a steady pace of capital expenditure and are expected to continue to grow in the overseas Internet and cloud computing sector.
China suggested to pay attention to the further support of policies for platform economy enterprises. Premier Li Keqiang chaired a symposium of economic situation experts and entrepreneurs on April 7, saying to promote the healthy and sustainable development of platform economy, stabilize and promote employment. We believe that Internet companies have created a number of globally competitive digital economy platform companies through the fierce competition in the market, and still have a good business model and development potential. The valuation of the platform company is low and the downside risk is small. It is a core asset with higher risk return than other assets in the market. It is recommended that we focus on representative, low valuation core platform companies such as Tencent, US mission, Ali, Jingdong, Kwai Fu, fast hand and beep.
Risk tips: 1. Overseas epidemic control is less than expected; 2. Sino US trade friction; 3. The risk of tightening Internet supervision; 4. The tightening of liquidity environment exceeded expectations; 5. Competition in overseas markets has intensified.
