On Monday (April 25), the three major A-share indexes fell across the board, with a decline of more than 5%, all reaching a new low in the year, and the net sales of northbound funds exceeded 4 billion yuan. The whole sector of the two cities was green, and 769 stocks fell by the limit. In the face of such a situation, institutions have interpreted the reasons for the decline of a shares, China International Capital Corporation Limited(601995) proposed that at present, the market is still in the “bottom grinding” period. How can the future market of A-Shares operate? How can we get out of the “grinding bottom” period?
On April 25, the three major A-share indexes collectively fell by more than 5%. As of the closing, the Shanghai Composite Index fell 5.13% to 292851 points and fell 3000 points; The Shenzhen composite index fell 6.08% to 1037928 points, and the gem index fell 5.56% to 2169 points; The total turnover of the two cities was 891.5 billion yuan, and the net sale of funds from the North was 4.397 billion yuan.
In terms of individual stocks, on Monday, the A-share market rose less and fell more. A total of 147 stocks rose and 4540 stocks fell. Among them, 33 stocks closed at the daily limit and 769 stocks fell by the limit.
Trading limit of individual stocks on Monday (April 25): p align = “center” tabulation: Zhang Ying
For the adjustment of a shares, institutions generally said that the current market is still in the “bottom grinding” period.
China International Capital Corporation Limited(601995) pointed out that the current market presents four characteristics: 1) from the transaction level, the corresponding turnover rate of recent transactions in the market has been close to about 2%, which is at a historical low, and the scale of net reduction of industrial capital has also decreased significantly; 2) In terms of valuation, after adjustment, the equity risk premium of CSI 300 is close to twice the standard deviation above the average again, and the valuation close to the low point in March 2020 is more extreme; 3) From the perspective of market behavior, the stable growth style with relative performance in the early stage showed signs of making up for the decline; 4) In terms of policies, the central bank, China Securities Regulatory Commission, China Banking and Insurance Regulatory Commission, safe and other departments have recently made positive statements on the recent economic situation and capital market environment, and resolutely maintained economic and market stability. At present, the bottom characteristics have been partially shown in terms of policy, valuation, capital and behavior signals. Combined with the current growth environment, it may take time to wait for a clearer inflection point. We still maintain the judgment that the current market is in the “bottom grinding” period. Although the short-term market may still be repeated, the opportunities gradually outweigh the risks in the medium and long term, and there is no need to be too pessimistic about the future performance.
With the adjustment of the valuation of the A-share market in 2020, the valuation of the A-share market has been basically flat, and the long-term valuation of the A-share market has been adjusted to the low point in 2018. Stock selection idea: stocks with undervalued value, performance and definite performance.
China Merchants Securities Co.Ltd(600999) said that positive signals are emerging. The growth rate of new medium and long-term social finance is higher than expected, becoming positive and the valuation position constitute the most important signal of the bottom of a shares. With the accelerated improvement of new social finance, the export increase effect brought by RMB depreciation may be more conducive to the expectation of economic improvement, and the marginal upward increase of net holdings of industrial capital is also conducive to market stability. In a word, from mid and late April to early May, A-Shares may usher in the starting point of the upward cycle. At present, they may be in the bottom area. The follow-up main line can focus on the accelerated construction of new and old infrastructure, policies and demand, and some optional consumption driven by RMB devaluation.
At the same time, institutions such as public funds and private placement also expressed optimistic views on the future market.
Liu Cunxin, assistant manager of Rongzhi investment fund under private placement paipaipai.com, believes that the sharp decline in the market is mainly due to three reasons: 1 The geopolitical conflict continues. At present, the market has basically included the expectation in the stock price, but the future changes are still difficult to determine. For example, more severe sanctions may push up the oil price again; The Fed’s firm Hawking and the US 10-year bond interest rate broke through the previous high of 2.9%, resulting in a large amount of funds flowing back to the United States again; 2. Repeated covid-19 epidemic; 3. The previous reduction of reserve requirements and interest rates was lower than expected, and the performance of some companies was lower than expected due to the impact of the epidemic, and the market confidence fell to a low point, resulting in a large number of funds continuously leaving the market for risk avoidance and waiting on the sidelines. We firmly believe that the current market is at a “U” bottom, that is, it needs to continue to grind the bottom. The inflection point of fundamentals will be after the epidemic has been effectively controlled.
Hu Zhenyi, manager of Honghan investment fund, said that in the short term, the gem broke the low point in March, and the subsequent bottom needs to be found. In the medium term, if there is no large-scale rebound in the second quarter, the market opportunity will reach the fourth quarter, during which the internal policy signal is the main observation.
Xingshi investment chief research official Lei also believes that the current market sentiment is in an extremely pessimistic state. In the face of many uncertainties, the market sentiment is pessimistic and is particularly sensitive to bad information. However, we need to see that the protection state of the policy is very strong, whether for the macro-economy or the capital market. From a medium-term perspective, it may be the worst stage of the macro environment and market sentiment. At present, the valuation level has reached near the historical bottom, and this stage has a good medium and long-term cost performance.
Shen Shengcai, a researcher at ningshui capital, said that the 3000 point of the Shanghai composite index is an important psychological threshold. After falling below, market sentiment has dropped to near the low point since 2018. At present, the stock market has more pricing for the risk of economic and profit decline, and the potential falling space is getting smaller and smaller. From the medium-term perspective, although the market bottom grinding process may continue to repeat, investors do not need to be too pessimistic and pay attention to the bottom opportunities of pre increase and High Dividend Stocks in the annual report and the first quarter report.
In terms of hot spots, all sectors fell one after another today, with relatively small declines in banking, artemisinin, securities and other sectors. The Internet e-commerce sector led the decline, with microled concept, wechat applet, cloud game, digital currency, Hongmeng concept and other sectors leading the decline; Today, Yaokang biology landed on the science and innovation board, down 17.89%.
Hot spot: differentiation of financial stocks to protect the market Huaan Securities Co.Ltd(600909) against the market limit
On Monday, financial stocks dominated by securities companies and banks fell less and performed actively. As of the closing, the banking sector fell by 3.3% and the securities sector fell by 4.21%, of which Huaan Securities Co.Ltd(600909) rose by the limit.
For bank stocks, Boc International (China) Co.Ltd(601696) analysis shows that since April, the economic impact of the epidemic on the economy has strengthened, and the export margin has weakened. The economic data from April to may may may have a slight and phased impact on bank stocks, but the investment main line of bank stocks “steady growth” has not changed, and the expectation of economy and real estate has become sufficient. Steady growth and steady real estate have strengthened, and the epidemic may also improve in the second quarter, The effectiveness of infrastructure construction is also gradually emerging, and bank stocks do not lack catalysis. Still optimistic about the performance of the industry, and continue to recommend high-quality regional banks. At the same time, we will also continue to observe the impact of changes in real estate, export and manufacturing on bank stock selection. Reiterate the view that steady growth and steady real estate should be strengthened, and continue to be optimistic about the bank market.
For brokerage stocks, Everbright Securities Company Limited(601788) pointed out that the current valuation of the securities sector deviates from the fundamentals, the valuation is at a historical low, and the repair of the undervalued financial sector under the main line of “steady growth” is still worth looking forward to. It is suggested to pay attention to two main lines: (1) leading securities companies with outstanding comprehensive strength and gradually increasing market share in the securities sector; (2) In the era of wealth management, it is recommended to have differentiated competitiveness in the field of Internet wealth management and benefit from the development of fund subsidiaries.
Freezing point: “yaomao” Jiangsu Hengrui Medicine Co.Ltd(600276) limit
On April 25, “yaomao” Jiangsu Hengrui Medicine Co.Ltd(600276) fell by the limit and closed at 29.7 yuan, a new low for the year.
In terms of news, on April 23, Jiangsu Hengrui Medicine Co.Ltd(600276) released its annual report for 2021. Both operating revenue and net profit attributable to shareholders of the parent company declined. Specifically, in 2021, the company achieved operating revenue of 25.906 billion yuan, a year-on-year decrease of 6.59%; The net profit attributable to the parent company was 4.53 billion yuan, a year-on-year decrease of 28.41%. In addition, the first quarter report of 2022 showed that the company’s revenue in the first quarter of this year was 5.479 billion yuan, a year-on-year decrease of 20.93%, the net profit attributable to the parent was 1.237 billion yuan, a year-on-year decrease of 17.35%, the deduction of non net profit was 1.180 billion yuan, a year-on-year decrease of 19.8%, and the net operating cash flow was 148 million yuan, a year-on-year decrease of 25.71%.
In this regard, China Securities Co.Ltd(601066) securities analysis believes that without breaking, Hengrui is undergoing adjustment and transformation in recent years, and investment and adjustment are more important to the medium and long-term development of the company than profit growth. Considering the leading position of the company in the field of innovative drugs and the extensive layout of tumor, autoimmunity, pain management, cardiovascular and metabolic, neurological and other fields, the buy rating is maintained.
