Event: on April 27, the new energy sector led the sharp rise of a shares. The Shanghai stock index rose 2.49%, the gem index rose 5.52%, the gem index recorded the largest one-day increase since March 17, 2016, and the CSI Xinneng rose 8.36%. Banks, real estate, textiles and clothing performed weakly. The turnover between the two cities was 920 billion yuan, with a former value of 840 billion yuan.
From “no sorrow, no dryness”, “consolidate the policy bottom, wait for the economic bottom, and survive the market bottom”, “RRR reduction is not the starting gun, stabilize first and then complete” to “wait for zero and return to work”, we suggest that since the 3 / 16 gold stability, the policy bottom has been continuously consolidated, but the economic bottom is expected to be proved by Q2. China’s economy is in the transition stage of reverse cycle adjustment in stage 1 of the Pringle cycle and recovery in stage 2, and A-Shares are in the most grinding stage of stability, We need to wait for the dawn to survive the bottom of the market. When the market panicked on April 25th, we pointed out in “waiting for the dawn”: the dawn of short-term improvement of the crux is waiting for the social aspect of the epidemic in Shanghai to be cleared.
At the beginning of dawn, the number of people discharged from the cabin increased greatly, 200 cases were added in the social aspect, and the social aspect of zone 6 was cleared. On April 26, 12309 cases were actually added locally, which fell for four consecutive days after rebounding on April 22. The number of people discharged from the cabin was 33173, an increase of 124% over yesterday. Among the new positive cases, 171 cases were newly added in the social area, 217 cases in the former value, 12138 cases in the control area, and 15795 cases in the former value. There were 200 new positive cases in the city. At present, among the 16 districts in Shanghai, Chongming, Yangpu, Huangpu, Jiading, Fengxian and Qingpu have achieved zero social aspects, and only Pudong, Xuhui and Baoshan have more than 10 social aspects.
Intensive policies were introduced to improve investor expectations. 1) We mentioned earlier that the market usually performs poorly when the RMB exchange rate depreciates rapidly. On April 25, the people’s Bank of China decided to reduce the foreign exchange reserve ratio of financial institutions by 1 percentage point from May 15, 2022. The central bank’s move aims to release foreign currency supply and intervene in the supply of foreign exchange market to ensure the stability of exchange rate. In response to the media interview on April 26, it was said that there have been some fluctuations in the financial market recently, which are mainly affected by the expectations and emotions of investors. 2) On April 25, the general office of the State Council issued the opinions on further releasing the consumption potential and promoting the sustainable recovery of consumption, which released the consumption potential and promoted the sustainable recovery of consumption. On April 26, the 11th meeting of the central financial and Economic Commission stressed the need to coordinate the two major events of development and security, and firmly establish the bottom line thinking. We will comprehensively strengthen infrastructure construction and build a modern infrastructure system.
Under the extreme compression of emotion, violent counterattack is imminent. 1) On April 25, we observed that from the rapid depreciation of the exchange rate, the rise of the linkage between stocks and exchange rates, and the sentiment index (the sum of the length of the 5-day physical negative line referred to on the GEM) exceeding 9%, the panic mood is close to the extreme value. 2) The end of the first quarterly report is approaching, the epidemic prevention and control in Shanghai has been effective, the US debt peaked and fell before the Federal Reserve’s interest rate meeting in May, the steady growth expectation before the Politburo meeting is still saturated, and all levels are improving in the key window period. 3) In addition, ERP shows that the current market allocation value is prominent. Historically, ERP has certain guiding significance for the yield of CSI 300 in the next year. The ERP of 10-year CDB bond and CSI 300 predicted net profit in 2022 was 7.25%, the highest since 2015, exceeding the end of 2018 and February 2020.
At the dawn, the Quartet under the impact of the epidemic repair. a. Recovery of consumption after the epidemic: 1) household consumption; 2) Scene consumption; b. Self controlled long-term track: 1) wind power & Photovoltaic & nuclear power; 2) Semiconductor equipment and materials; 3) Military industry; c. Policy driven steady growth: 1) construction; 2) Consumption of building materials; 3) Real estate development; d. Strategic resources: 1) food security; 2) Energy security; 3) Metal resources.
Risk tip: the conflict between Russia and Ukraine exceeded expectations, the persistence of inflation exceeded expectations, and the epidemic repeatedly exceeded expectations.
