Key investment points:
According to market review, the Shanghai Composite Index fell 0.94% and the gem index fell 3.64% last week. In terms of style, the CSI 300 closed down 1.06% and the CSI 500 closed down 2.21%. In terms of trading volume, there was a small and large volume in the whole week. The two cities traded 2.8 trillion yuan in the whole week, and the average daily trading volume increased by 11 billion yuan month on month; Among them, there was a small-scale outflow of funds from the north, with a net outflow of 6.557 billion yuan throughout the week. In terms of industry, shenwanyi industry fell more or rose less, with building decoration, steel and building materials industries leading the increase, all exceeding 3.0%; Agriculture, forestry, animal husbandry and fishery, power equipment, electronics and computer industries led the decline.
In terms of policy, Li Keqiang chaired the national standing committee meeting and continued to deploy the “steady growth” initiative. The meeting pointed out that “the complexity and uncertainty of China’s external environment have increased, and some have exceeded expectations”. On the one hand, the global economic recovery has slowed down, and the commodity markets such as grain and energy have fluctuated sharply; On the other hand, the epidemic situation in China has spread in many places, which has brought obvious pressure to the operation of enterprises. In terms of specific measures, first, some steady growth measures in the central economic work conference and the government work report can be implemented in advance; Second, strengthen the guarantee of helping enterprises to bail out and finding out the bottom of employment; Third, timely and flexibly use a variety of monetary policy tools such as refinancing to increase support for the real economy, including strengthening the implementation of prudent monetary policy, studying and taking financial support measures, and establishing special refinancing to support financing in key areas and weak links. Then on the 8th, Li Keqiang presided over a symposium of economic situation experts and entrepreneurs to listen to the opinions of market subjects, which helped stabilize market expectations. Overall, “new downward pressure is further increased” and “steady growth” should be put in a more prominent position. It is expected that the steady growth policy will continue to increase. Overseas, the Federal Reserve’s interest rate meeting in March showed that the Federal Reserve started the table contraction as early as or in May, with a faster pace than the previous round of table contraction cycle; And many participants said that one or more 50bp interest rate hikes were appropriate, and the pace of overseas liquidity tightening was faster than the market expected.
In terms of strategy, overseas, the tighter monetary policy expectation of the Federal Reserve still makes the overseas equity market in a turbulent situation. In China, the epidemic factors have led to the increase of difficulties in stabilizing growth. The steady growth measures have been continuously deployed at the recent three national standing committee meetings. Although the national standing committee meeting last week focused on monetary policy, the foothold is refinancing, the narrowing of the interest rate gap between China and the United States and even the risk of upside down. The certainty of reducing reserve requirements and interest rates is not high, and the role of monetary policy in promoting the valuation of the stock market may be limited. As far as the market is concerned, it is still in the stage of shock bottoming in the short term. We continue to emphasize the allocation value of the equity market at the bottom stage. In the short term, the epidemic has further raised the pressure on China’s steady growth. If the macro data in March is lower than expected, there is still a game opportunity for the steady growth sector. In terms of industry allocation, based on the judgment that the market will be in the bottom building process for some time in the future, we believe that after the overall decline of all sectors in the market, the sectors with relative certainty will receive capital intervention. Therefore, we can pay attention to the construction machinery sector under the logic of stable growth, as well as the transportation and tourism sector under the logic of the medium and long-term end of the epidemic, and the market is gradually desensitized.
Risk tip: overseas market fluctuation risk, economic downturn exceeding expectations, and global epidemic development exceeding expectations
