Interpretation of important events this week:
This week, the market performance fluctuated downward, with the Shanghai stock index down 1.25%, the Shanghai and Shenzhen 300 index down 0.99% and the gem down 4.26%. Financial heavyweights were basically flat with the market as a whole, with the brokerage sector up 0.03% and the insurance sector down 1.83%. This week, the central bank decided to cut the deposit reserve ratio of financial institutions by 0.25 PCT from April 25. For urban commercial banks without inter provincial operation and rural commercial banks with deposit reserve ratio higher than 5%, an additional 0.25 percentage point will be reduced. We believe that this adjustment of policy interest rate is an important means for the central bank to hedge against the slowdown of economic growth and the increasingly complex politics outside China. It is also an important impact on the economy caused by the expansion of the epidemic in March. The lack of market confidence pulled down the stock base trading volume this week, which fell 2% month on month. It is expected that the reduction of reserve requirement next week is expected to boost market sentiment to a certain extent. For the insurance sector, although the liability side is still under pressure in the first quarter, with the increase of the central bank’s efforts to broaden credit, the credit side of real estate enterprises is expected to usher in marginal repair, which will promote the driving force of the recovery of the stock price of insurance enterprises. Therefore, we are optimistic about the safety of leading insurance enterprises in the short term. For the securities sector, the performance of self operation and asset management in the first quarter may significantly drag down the quarterly report, and the short-term market liquidity is expected to improve marginally, which may promote the marginal improvement of the fundamentals of securities companies. Investors are advised to pay attention to Citic Securities Company Limited(600030) , the leader of institutional business, the Citic Securities Company Limited(600030) , the Gf Securities Co.Ltd(000776) , which can improve the investment banking business and has a relatively low performance base. This time, benefiting from the marginal relaxation of real estate policy, the asset quality of some financial institutions is expected to usher in marginal improvement. It is suggested that investors should pay attention to the leading targets of trust and non-performing sectors.
Sub sector view
(1) brokerage sector: the pressure of self operation in the first quarter dragged down the quarterly report, thus suppressing the enthusiasm of the market to continue to be long. However, considering that the central bank’s RRR reduction releases liquidity and the sector valuation is at the bottom of history, it is expected to drive the repair of the sector valuation. It is suggested that Citic Securities Company Limited(600030) , the leader of investor institutions’ business, the Gf Securities Co.Ltd(000776) , the improvement of investment banking business and the Gf Securities Co.Ltd(000776) , the leader of wealth management.
(2) insurance sector: the margin of life insurance improved in March, and the sales of auto insurance were affected by the epidemic. NBV data of insurance companies in the first quarter is still under obvious pressure; The basic principles of the new personal insurance sales regulations remain unchanged, and the marginal policy is relaxed, which helps to accelerate the transformation of the industry. We believe that in the next step, the credit easing efforts will be increased, and the credit end of real estate enterprises is expected to usher in marginal repair, which will promote the driving force of the stock price recovery of insurance enterprises. Therefore, we are optimistic about Ping An and Taibao, the leading insurance enterprises in the short term
(3) diversified financial sector: the real estate policy is expected to rise significantly, so the previous regulatory situation of real estate trust is expected to improve marginally, driving the improvement of the fundamentals of trust institutions. In addition, the liquidation of some private real estate enterprises in China is expected to drive the expansion of the scale of real estate non-performing stock business. It is suggested to pay attention to Hainan Haide Capital Management Co.Ltd(000567) , Avic Industry-Finance Holdings Co.Ltd(600705) , Guangzhou Yuexiu Financial Holdings Group Co.Ltd(000987) , Jingwei Textile Machinery Company Limited(000666)
