Important meeting
On April 29, the Political Bureau of the CPC Central Committee held a meeting to analyze and study the current economic situation and economic work and review the national talent development plan during the 14th five year plan.
Keynote of the meeting: the goal of steady growth remains unchanged, the policies have been determined, the implementation of superposition planning incremental policy tools has been accelerated, and a positive signal has been released
The goal of steady growth remains unchanged. Policies have been determined to accelerate the implementation of superposition planning incremental policy tools, and the meeting released a positive signal. The meeting of the Political Bureau of the CPC Central Committee called for "strengthening macro policy adjustment, stabilizing the economy, striving to achieve the expected goal of economic and social development throughout the year and maintaining the economic operation within a reasonable range". This is a direct response to the concerns about the current market steady growth policy and its effect, and shows the confidence and determination of the central government to achieve the annual economic growth target of 5.5%. In order to achieve this goal, on the one hand, the meeting called for "accelerating the implementation of the determined policies, implementing the policies of tax rebate, tax reduction and fee reduction, and making good use of all kinds of monetary policy tools", on the other hand, it called for "stepping up the planning of incremental policy tools, strengthening camera regulation, and grasping the advance and redundancy of policies under the guidance of objectives". In combination with the fifth anti-corruption work conference of the State Council on April 25, Premier Li Keqiang stressed that "the determined policies and measures should be largely implemented in the first half of the year". We believe that the policies determined in the central economic work conference and the government work report at the end of last year are expected to significantly support the economy in the first half of the year. At the same time, the incremental policies are also continuously planned, leaving "advance" and "redundancy" for achieving the goals, and the policy strength continues to increase. On the whole, the meeting of the Political Bureau of the CPC Central Committee continued the general tone of steady growth, which was consistent with our judgment in the weekly report that the failure of interest rate reduction expectations did not hinder the follow-up force of policies, and the pattern of shock bottoming remained unchanged. The meeting released a positive signal, which will effectively boost market risk appetite.
Policy starting point: precise epidemic prevention and control, infrastructure, consumption and real estate jointly support the 5.5% target
Accurately prevent and control the epidemic, minimize the impact of the epidemic on economic and social development, and ensure smooth logistics. The meeting stressed that "we should effectively coordinate the epidemic prevention and control and economic and social development according to the new characteristics of virus variation and transmission", and "minimize the impact of the epidemic on economic and social development" on the basis of adhering to dynamic clearing. At the same time, in view of the "one size fits all" approach to logistics in some areas due to epidemic prevention in the past period, the meeting called for "adhering to the national game of chess, ensuring smooth traffic and logistics, and ensuring the normal operation of key industrial chains, supply chains, anti epidemic protection enterprises and key infrastructure". We believe that the meeting of the Political Bureau of the CPC Central Committee specially emphasizes the new characteristics of virus variation and transmission, which is likely to further adjust epidemic prevention measures, reduce the economic cost of epidemic resistance, and strengthen the guarantee of smooth logistics, which is conducive to alleviating the disturbance of the previous epidemic to production and sales.
We will comprehensively strengthen infrastructure construction and give play to the role of effective investment in driving economic growth. The meeting stressed that "we should fully expand China's demand, give play to the key role of effective investment, strengthen the guarantee of land, energy use and environmental assessment, and comprehensively strengthen infrastructure construction". This meeting did not emphasize the guarantee of funds, which shows that under the background of financial development and the pre issuance of special bonds, the funds have been basically in place to support infrastructure investment. The follow-up work is mainly in the fields of land and other factors guarantee and promoting the preliminary preparation of projects such as environmental impact assessment. It is expected that the capital construction will make significant efforts to stabilize the growth without doubt. The specific direction and starting point have been clearly deployed at the meeting of the central financial and Economic Commission on April 26.
Promoting consumption may be an important area for incremental policy. The meeting called for "giving play to the traction and driving role of consumption on the economic cycle". Although the statement on promoting consumption is too short, from the perspective of recent policies and measures, infrastructure and real estate have been clearly deployed since the central economic work conference at the end of last year. Therefore, promotion fees may be an important area for increasing the force of policies. In particular, a number of measures, such as local consumption vouchers within the scope of local government powers, promoting consumption in the field of household appliances and encouraging automobile consumption, are expected to be introduced in succession.
The real estate regulation policy continues to be relaxed in the way of "implementing policies according to the city". Adhering to the general tone of "no speculation in housing and housing", the meeting stressed that "support all localities to improve real estate policies based on local conditions, support rigid and improved housing demand, and optimize the supervision of commercial housing pre-sale funds". This is a direct response to the relaxation of regulation and control policies by local governments since the beginning of this year. Compared with the previous "tacit" attitude of regulation and control relaxation, this meeting clearly expressed "support" and clearly covered the rigid and improved housing needs, which also provided support for local governments to adjust the identification standards of first and second homes. We believe that although from the statement of the meeting, there is no need to expect the relaxation of real estate regulation policies at the national level in the short term, except for the first tier cities with high pressure on house price regulation, other cities can further introduce more real estate regulation and relaxation policies.
Grasp the three main opportunities under the oversold rebound: the continuation of stable growth market, the expected effect of promoting consumption, and the main growth line is worth looking forward to
It is suggested to seize the opportunity of oversold rebound after the meeting of the Political Bureau of the CPC Central Committee. We believe that the meeting of the Political Bureau of the CPC Central Committee on April 29 continued the growth target of 5.5%, and the relevant policies will be further overweight and accelerated, which will guide the market to unify its expectations of the economy and policy strength. At noon on April 29, after the release of the communique of the Political Bureau of the CPC Central Committee, A-Shares rebounded and recovered 3000 points, the RMB exchange rate stopped falling and rebounded, and the risk appetite of A-Shares recovered significantly. It is suggested to seize the opportunity of oversold rebound.
Pay attention to three main line opportunities: the steady growth market continues, the effect of promoting consumption can be expected, and the growth main line is worth looking forward to. We believe that in combination with the driving point of the stable growth policy of the meeting of the Political Bureau of the CPC Central Committee, the three main opportunities deserve attention. ① Stable growth chain has strong certainty and over allocation value. Focus on the investment opportunities brought by Comprehensively Strengthening the regulation and control policies of infrastructure and real estate, as well as the allocation opportunities of upstream and downstream building materials and banking sectors. ② The promotion fee policy is expected to be introduced one after another, the superimposed epidemic prevention and control is expected to gradually achieve results, the economic cost of epidemic prevention is expected to decline, and the certainty of residents' consumer services is gradually revealed. We should pay attention to the valuation and repair of food and beverage, medicine and biology, grasp the price rise of mandatory consumer goods and the "rush" opportunities related to the recovery of service travel chains. ③ There is a need for valuation repair after oversold on the main growth line. In addition, pay close attention to the positive boosting effect of the policy released by the "introduction of specific measures to support the standardized and healthy development of the platform economy" after the "completion of special rectification" of the platform economy.
Risk tips
There are deviations in policy interpretation.
