Zhou viewpoint
This week (4.11-4.17), A-Shares fluctuated downward, the Shanghai stock index fell - 1.25%, and the gem index fell again compared with last week, as high as - 4.26%. Mainly on April 11, the yield of China US 10-year Treasury bonds showed the first upside down in nearly 12 years, increasing the risk of capital outflow and rising risk aversion. On that day, A-Shares fell sharply, the Shanghai stock index fell by more than - 2.5%, and the gem index fell by - 4.2%. In terms of industry style, consumption is dominant and growth is at the bottom. The RRR reduction came as scheduled, but the intensity was less than expected. The "comprehensive + directional" combined RRR reduction only released 530 billion long-term liquidity. Although there is a comprehensive RRR reduction this time, the range is only 25bp, lower than the 50bp expected by the market, which is relatively conservative. There is still room for reducing reserve requirements and interest rates in the second quarter. The root cause is that the recent frequent outbreaks in China have exacerbated the downward pressure on fundamentals, forced the steady growth policy to increase and speed up, and maintained a steady and loose monetary policy to escort steady growth.
From the perspective of the process of policy development, the combination of steady growth has been strengthened and accelerated to promote consumption. Similar laws can be seen in the previous steady growth in the resumption of trading: broadening money, expanding infrastructure, stabilizing real estate and promoting consumption are all important focus points of the steady growth combination. The policy focus ranges from finance to industry, from investment to consumption.
The upside down of interest rate spread between China and the United States strengthens the logic of "internal stagnation and external inflation". The core contradiction of A-Shares has not been solved. The market is still in the process of shock and bottom grinding, and the configuration value of the Chinese version of "faang" remains. The consumer side under "steady growth" began to focus on the main line of post epidemic dilemma reversal. For example: support the policy of overweight cars, household appliances and mass consumer goods that raise prices to counter attack.
Risk tips
(1) macroeconomic downturn accelerated
(2) the policy is not as expected
(3) large scale outbreak of geo conflict
