Since 2022, A-Shares have led the global decline:
1) wandequan a fell by 27.03%, gem index fell by 35.28% and CSI 300 fell by 23.40%;
2) in contrast, the performance of developed economies is as follows: the UK FTSE 100 has risen by 0.58%, the Dow Jones industrial index has fallen by 6.30%, the S & P 500 has fallen by 9.86% and the Nikkei 225 has fallen by 7.26%; The performance of emerging economies is as follows: Indonesia composite index rose 9.64%, Argentina Merv rose 9.17%, Brazil ibovespa index rose 5.59%, India sensex30 fell 2.87% and South Korea composite index fell 10.39%.
There are two core factors for the sharp decline of A-Shares in 2022:
1) the repeated epidemic not only led to the further rise of downward pressure on the economy, but also had a serious impact on the confidence of entrepreneurs;
2) the real estate market continues to be depressed. Although policies to stimulate the real estate industry have been introduced in various places since the end of last year, the effect is general under the impact of the epidemic.
At present, the Shanghai stock index is lower than the bottom range predicted in our 2022 strategy report:
1) in the report "Ye Luo, GUI gen - 2022 broad asset allocation outlook" released in December last year, we clearly pointed out that there was an overestimation of about 25% in the valuation of the stock market at that time. Combined with our prediction of the profits of listed enterprises, it is estimated that the bottom range of the Shanghai stock index in 2022 is 29303230 points (see the report for details);
2) at present, the Shanghai stock index is lower than this target range, which means that all the bad factors we predicted at that time have been traded.
The new events that have a negative impact on the A-share market this year are the multi-point outbreaks in China:
1) this factor will increase the uncertainty of the market when the epidemic situation in core cities such as Shanghai and Beijing is not significantly alleviated or China's epidemic prevention policy is not significantly changed;
2) the unpredictability of China's epidemic prevention policy is strong. It is difficult for us to predict in advance and wait for the implementation of the policy or certain changes in the margin before making investment decisions. Maybe it is a better strategy.
However, we can still make some judgments on a shares:
1) if the year-on-year GDP in the fourth quarter of this year can be the same as that in the first quarter of this year, that is, the year-on-year GDP growth rate in 2022q4 is 4.8%, the reasonable position of Shanghai stock index is around 3200; 2) For every 1 percentage point increase or decrease in the year-on-year growth rate of GDP, the reasonable position of the Shanghai stock index will change by about 104 points.
Risk tip: monetary policy exceeded expectations and economic recovery exceeded expectations.
