judging from the internal and external environment during the May Day holiday in China, the overseas market is relatively volatile , the US stock market rebounded slightly after a continuous significant correction, the ten-year US bond yield hit 3%, continued to hit a new high since 2018, and the US dollar index hovered high; VIX shock climbing; International oil prices continued to consolidate against the backdrop of the stalemate in the international geopolitical situation in China, Hong Kong stocks had a volatile opening performance earlier than a shares, and the steady growth sector outperformed ; In terms of local epidemic situation, the number of new cases in Shanghai continues to decline, and the prevention and control situation in Beijing is still severe, but there is no large-scale spread for the time being local epidemic prevention and control policies, high-frequency data during May day showed that travel and offline consumption were affected to some extent . Overall, we believe that the marginal impact of internal and external factors on the current market during May day may be limited, and the future trend still needs to pay attention to the marginal changes of the main contradictions .
When we looked forward to 2022 at the beginning of the year, we judged that the Chinese and foreign cycles were reversed, and the whole may show the characteristics of "internal stagnation and external inflation", "internal loosening and external tightening". The negative growth of GDP in the first quarter of the United States was earlier than expected, which may indicate that the sequelae of the super stimulus policy under the epidemic plus the negative impact of the supply shock has begun to appear. Whether China and foreign countries will gradually converge to the synchronous downward trend in the future, or whether China will continue to take the lead and take the lead in recovery, is an important macro variable affecting the performance of global and Chinese asset prices. At present, the latter may be a situation with relatively high probability, which highly depends on the implementation of China's steady growth policy and the progress of epidemic prevention and control after the Politburo meeting, if the implementation of the steady growth policy is strengthened, or the probability of this situation is further improved looking forward, we believe that although there are still more uncertainties inside and outside, the market already has the value of the middle line, so we don't have to be too pessimistic about the future market structurally, we believe that the field of undervalued "steady growth" still has certain allocation value. We will pay comprehensive attention to the trend of overseas inflation, China's "steady expectation" measures and the progress of epidemic prevention and control to judge whether the relevant growth sectors have entered the inflection point of repair.
industry configuration suggestions: steady growth main line still has stage configuration value. Pay attention to growth style according to the progress of global inflation situation
1) in the "bottom grinding" stage of the market, the stable growth sector with relatively low valuation may still have relative benefits in the current macro environment, such as traditional infrastructure, stable demand for real estate and related industrial chains (real estate, building materials, construction, household appliances, home furnishings, etc.);
2) for the consumption in the middle and lower reaches with many adjustments in the early stage, low valuation and clear medium and long-term prospects, choose stocks from bottom to top, including household appliances, light industry and household appliances, automobiles and parts, agriculture, forestry, animal husbandry and fishery, medicine, etc;
3) risks in the manufacturing growth sector, including new energy vehicles, new energy and technology hardware semiconductors, have been released, but the turnaround lies in the marginal improvement of "stagflation" risk, global liquidity and market sentiment.
market returns Gu : index first suppresses and then rises, Shanghai index returns above 3000 points, and the transaction rebounds slightly
In the first half of last week, the market performed poorly under the influence of factors such as the tightening expectation of overseas US monetary policy and the severe situation of local epidemic prevention and control in China. The Shanghai composite index once fell below the 3000 and 2900 points in a row; In the second half of the week, the quarterly economic situation meeting of the central financial and Economic Commission and the Political Bureau successively transmitted the signal of "stable growth". Relevant departments actively responded to the market expectation of maintaining stability. There were also signs of marginal moderation in China's local epidemic, and the index rebounded. The Shanghai composite index returned to above 3000 points, falling 1.3% for the whole week. The average daily turnover of A-Shares returned to more than 900 billion yuan, with a net inflow of 4.25 billion yuan in the whole week. In terms of style, the growth style with more early pullbacks performed better. The weekly growth index of the gem rose by 1.0%, and the Shanghai and Shenzhen 300, which is biased towards the blue chip market, rose slightly by 0.1%. In terms of industry, steady growth sectors such as construction benefited from policy expectations, leading the market; Textile and clothing, agriculture, forestry, animal husbandry and fishery, and light industry manufacturing sectors performed poorly.
Market Outlook: focus on the implementation of China's steady growth policy in the future
Judging from the internal and external environment during China's May Day holiday, the overseas market was relatively volatile, and the US stock market rebounded slightly after a continuous and obvious correction. The ten-year US bond yield hit 3%, continued to hit a new high since 2018, and the US dollar index hovered at a high level; VIX shock climbing; International oil prices continued to consolidate against the backdrop of the stalemate in the international geopolitical situation. From the perspective of China, Hong Kong stocks had a volatile opening performance earlier than a shares, and the steady growth sector outperformed relatively; In terms of local epidemic situation, the number of new cases in Shanghai continues to decline, and the prevention and control situation in Beijing is still severe, but there is no large-scale spread for the time being; Under the epidemic prevention and control policies of various regions, the high-frequency data during the May Day period show that travel (such as passenger traffic) and offline consumption (such as catering and movie viewing) have been affected to a certain extent. On the whole, we believe that the marginal impact of internal and external factors on the current market during May day may be limited, and the future trend still needs to pay attention to the marginal changes of the main contradictions.
When we looked forward to 2022 at the beginning of the year, we judged that the Chinese and foreign cycles were reversed, and the whole may show the characteristics of "internal stagnation and external inflation", "internal loosening and external tightening". The negative growth of GDP in the first quarter of the United States was earlier than expected, which may indicate that the sequelae of the super stimulus policy under the epidemic plus the negative impact of the supply shock has begun to appear. Whether China and foreign countries will gradually converge to the synchronous downward trend in the future, or whether China will continue to take the lead and take the lead in recovery, is an important macro variable affecting the performance of global and Chinese asset prices. At present, the latter may be a situation with relatively high probability, which highly depends on the implementation of China's steady growth policy and the progress of epidemic prevention and control after the Politburo meeting, if the implementation of the steady growth policy is strengthened, or the probability of this situation is further improved looking forward, we believe that although there are still many uncertainties inside and outside, but the market already has the value of the middle line, there is no need to be too pessimistic about the future structurally, we believe that the field of undervalued "steady growth" still has a certain allocation value and pay comprehensive attention to the trend of overseas inflation, China's "steady expectation" measures and the progress of epidemic prevention and control to judge whether the relevant growth sectors have entered the inflection point of repair.
Recent progress in the following aspects should be noted:
1) the Political Bureau of the CPC Central Committee sets the policy orientation for the next stage 4 on April 26, the central finance and Economic Commission stated that it would build a modern infrastructure system. On April 29, the Politburo meeting continued to emphasize "stable growth", and directly responded to and clarified the focus issues of market concern in terms of policy strength ("stepping up the planning of incremental policy tools", "policy advance and redundancy"), relief and assistance policies, consumption, real estate, platform economy, stabilizing foreign trade and other aspects, which helped to improve market expectations.
Meanwhile, on the afternoon of April 29, the Politburo conducted a collective study on standardizing and guiding the healthy development of Chinese capital according to law; Recently, the general office of the State Council issued the opinions on further releasing consumption potential and promoting the sustainable recovery of consumption, so as to promote the orderly recovery and development of consumption; CSDCC reduced the transfer fee of stock trading by 50%, which is the first reduction since 2015; The CSRC issued the opinions on accelerating the high-quality development of the public fund industry to speed up the construction of a new development pattern of the public fund industry.
2) the local epidemic has an impact on short-term growth 4 official manufacturing PMI was 47.4 in April, down 2.1 percentage points from March, and the itemized data were also much lower than March. The supply impact caused by the local epidemic, including logistics obstruction, difficult supply of raw material inventory, poor sales of finished products and other problems, led to weaker expectations. However, on the whole, the impact scope of this round of epidemic is less than that in early 2020. With the further decline of new cases of epidemic in Shanghai, the epidemic in Beijing continues to be controlled, The policy guarantee is gradually implemented, and the impact may be gradually alleviated.
3) the disclosure of the annual report of Listed Companies in 2021 and the first quarterly report of this year ends . In 2021, the non-financial performance of A-Shares increased by 26.0% (deducting 40.4%). In the fourth quarter of the year, affected by the poor performance of real estate, power, agriculture, commerce and retail, the profits of non-financial enterprises fell more. In the first quarter of 2022, the performance of A-Shares increased by 4.1%, the financial performance increased slightly negatively, and the high growth in the upstream drove the growth of non-financial profits by 9.1%.
4) overseas progress : Recently, the United States announced that the ISM manufacturing index in April was 50.9, far lower than the expected and previous value, reaching a new low since 2020; The marginal change of us demand expectation and inflation pressure remain. Pay attention to the monetary policy path of the follow-up FOMC meeting. The international geopolitical situation is still in a stalemate, and we still need to pay attention to the future evolution. In terms of exchange rate, the offshore exchange rate of US dollar against RMB broke through 6.60 again during China's small and long holiday
bank industry suggestions : steady growth main line still has stage allocation value, and pay attention to growth style according to the progress of global inflation situation
specifically, at present, we should pay attention to three directions:
1) in the "bottom grinding" stage of the market, the stable growth sector with relatively low valuation may still have relative benefits in the current macro environment, such as traditional infrastructure, stable demand for real estate and related industrial chains (real estate, building materials, construction, household appliances, home furnishings, etc.);
2) for the consumption in the middle and lower reaches with many adjustments in the early stage, low valuation and clear medium and long-term prospects, choose stocks from bottom to top, including household appliances, light industry and household appliances, automobiles and parts, agriculture, forestry, animal husbandry and fishery, medicine, etc;
3) risks in the manufacturing growth sector, including new energy vehicles, new energy and technology hardware semiconductors, have been released, but the turnaround lies in the marginal improvement of "stagflation" risk, global liquidity and market sentiment.
recent concerns: 1) epidemic situation in China; 2) Setting the tone of China's policy; 3) Overseas geopolitical situation and US monetary policy; 4) China US relations.
