At the beginning of 2022, A-Shares were "not popular", and institutional heavy position stocks and popular track stocks broke and callback. The external is also impacted, the global risk appetite drops sharply, and the value strategy is sought after. The scene of deja vu at the beginning of 22 years inevitably reminds people of the Spring Festival market of 21 years. The two markets do have many similarities. What enlightenment does the market at that time have for the current? In contrast, what are the differences in the current market?
High and low reversal, group breaking, and reconfirmation of the main line of steady growth. Since the end of last year, our strategic point of view has been emphasizing two judgments: first, the probability that the incremental capital at the beginning of the year exceeded the expectation of "a good start" is decreasing, the previous restless pure risk preference promotion logic in spring is weakening, and it is difficult to reproduce the trend of cross-year and constant strength of the main line; Second, the macro policy has shifted from cross cycle to counter cycle. The credit conditions are about to be stabilized in a real sense. The market returns to fundamental pricing. Steady growth is the largest beta main line in the next quarter. From the recent market, these two core judgments are continuously confirmed.
Deja vu: comparison between the early 21st century and the current market. The scene of deja vu at the beginning of 22 years inevitably reminds people of the Spring Festival market of 21 years. In conclusion, there are many similarities between the two segments of the market: first, the market trend is similar, which is also the high valuation of heavy stocks; Second, the contributing factors are from the jump in US bond interest rates, and the external environment is generally similar (epidemic easing + inflationary pressure); Third, it is difficult to continue incremental funds, which is another important reason for the stampede of heavy warehouse stocks.
Same and different: history is not a simple repetition. At the current time point, the two practical problems for market research and judgment are: 1. How to evaluate the level of this round of adjustment? 2. Will the track market reappear in the medium term in the future?
On the first question, the market at the beginning of the 21st century does have a strong reference significance for short-term judgment. As mentioned above, the current round of market decline mainly comes from external shocks (changes in US bonds) and capital difficulties (the increment at the beginning of the year is difficult to exceed expectations), while the fundamental trend has not changed fundamentally, and the macro environment is evolving in the direction conducive to equity assets. Therefore, referring to the beginning of the 21st century, it can be defined as the monthly level adjustment, and the pressure is mainly concentrated in the overvalued value and heavy position sectors.
Second, we believe that history is not a simple repetition, and the follow-up market of 21 years is difficult to reproduce in the medium term in the future. In the medium term of the future, the internal and external environment has reversed the trend compared with 2021: China's steady growth policy is in full force, the credit pulse has bottomed out and rebounded, and the short-term double carbon target may also be loosened; The external Federal Reserve strengthened its expectation of shrinking the table and probably started to raise interest rates in the first half of the year. It is the general trend to tighten global liquidity. These are the differences from 21 years, which also means that the follow-up market in 21 years is of little significance for the medium-term reference in the future.
Bid farewell to the traditional restless thinking and return to fundamental pricing. The rise of value may only be the beginning. Considering that the tightening trend of peripheral liquidity is basically established (inflationary pressure + easing of the epidemic), it is difficult to form a joint force between public and private placement and foreign capital increment in the short term, and it is not appropriate to copy the bottom prematurely for overvalued and heavily held institutional stocks in the short term. From the perspective of fundamental pricing, the rise of value may only be the beginning. At present, it is the initial stage of the overall force of the steady growth policy, and steady growth is still the largest beta main line in the next quarter.
Strategic suggestions and industry recommendations: (I) credit conditions are about to stabilize in a real sense, the inflection point at the bottom of m1-ppi has been confirmed, the probability will continue to repair upward in the later stage, continue to be optimistic about the repair of value stocks in the medium term, and recommend high-quality banks, state-owned enterprise developers and buildings / building materials in the direction of steady growth; (II) new infrastructure development direction: wind and solar energy storage, power operation and communication; (III) auto parts and household appliances with reversed upstream costs benefit from low valuation and concept catalyzed media.
Risk tips: 1. The epidemic situation is out of control; 2. A sharp recession; 3. The policy has changed more than expected.
