Before the May Day holiday, the A-share market once fluctuated violently, the index first suppressed and then rose, and the Shanghai stock index recovered from the loss of 3000 points. During the holiday, overseas markets also showed restlessness, and US stocks rebounded slightly after a continuous correction.
Looking forward to the market in May, institutions generally believe that the impact of overseas market fluctuations on A-Shares during the holiday is limited, and after the early adjustment, the current overall valuation of A-Shares has entered the “value range”, so there is no need to be overly pessimistic about the future market. On the one hand, the measures of “steady growth and stable expectation” in the internal environment were implemented, and positive signals of epidemic prevention and control appeared; On the other hand, with the landing of the Federal Reserve’s interest rate hike boots among external factors, A-Shares are expected to start the medium-term repair market.
pay close attention to the FOMC meeting of the Federal Reserve in May
During China’s May Day holiday, overseas markets were relatively volatile, and US stocks rebounded slightly after a continuous correction. Meanwhile, the decline was the strongest on Friday (April 29 local time). Affected by the collective decline of leading technology stocks, the NASDAQ index fell more than 4% on the same day. Cumulatively, during the May Day holiday (April 29 to May 3 local time), the S & P 500 index fell 2.61%, the Dow Jones Industrial Average fell 2.32% and the NASDAQ fell 2.39%.
At the same time, the interest rate of us 10-year Treasury bonds hit 3%, a new high since 2018, and the US dollar index hovered at a high level.
In the early morning of May 5, Beijing time, the Federal Reserve will announce the interest rate resolution of the FOMC meeting. In April, a number of fed executives have expressed or implied that the FOMC meeting in May will raise interest rates by 50 basis points. Among them, Federal Reserve Chairman Powell said on April 25 that he would take a slightly faster action on interest rates and would discuss raising interest rates by 50 basis points at the meeting in May.
China International Capital Corporation Limited(601995) chief overseas strategy analyst Liu Gang said that in the short term, the pressure of US stock earnings decline does exist, but it is still far from the actual recession. Looking forward to may, the key lies in whether the US stock market can see the dawn of falling inflation before the tightening pressure is not large enough to undermine the growth prospect. Therefore, the FOMC meeting in May (May 5) and the CPI data of the United States in April (May 11) will provide key verification to observe the strength comparison of the three forces of austerity, inflation and growth.
don’t worry about “five poor and six unique”
The A-share market fluctuated sharply last week. The main indexes once continuously fell below the previous low, but after the short-term market pessimism was vented, the policy was intensively released positive, and the three indexes bottomed out and recovered their lost ground one after another.
Looking forward to may, A-Shares have traditionally been said to be “five poor and six absolutely”. In the past 11 years, most of the Shanghai stock index fell during this period, and the market will not improve until July.
Western Securities Co.Ltd(002673) stressed that this year, due to the advance of “spring agitation” and the disturbance of the epidemic in April, the market sentiment did not overheat seasonally; The overall monetary environment is still abundant with the addition of the central bank’s recent total amount and the liquidity investment of structural instruments; With the end of the disclosure of the first quarterly report, the market will return to the pursuit of performance certainty. Although the style will be further switched, its impact on the market will tend to ease. Therefore, there is no need to worry about the so-called “five poor and six absolutely”.
Citic Securities Company Limited(600030) strategy team said that the four major factors affecting the market in the early stage have shown positive signals, and it is expected that the medium-term repair market of A-Shares will be opened in May: it is expected that the negative economic impact caused by repeated local epidemics will be gradually alleviated; The Fed’s interest rate hike panic fell in stages in May. Under the heavy pressure of overseas inflation, the trade friction environment may improve in stages; The first quarterly report of listed companies landed, and the market entered the performance vacuum period and confidence recovery period. It is expected that the market will usher in a trend market of value and growth resonance repair lasting for several months in May.
what marginal changes does the market pay attention to
China International Capital Corporation Limited(601995) strategy team said that in general, although the overseas market volatility intensified during the May Day holiday, its marginal impact on the current A-share market may be limited, and the future trend still needs to pay attention to the implementation of the “steady growth” policy and the progress of epidemic prevention and control.
China International Capital Corporation Limited(601995) said that although there are still some uncertainties in the current internal and external environment, the market has a midline value and there is no need to be too pessimistic about the future market. Structurally, the undervalued “steady growth” field still has allocation value. It is recommended that investors pay comprehensive attention to the trend of overseas inflation, China’s “steady expectation” measures and the progress of epidemic prevention and control, so as to judge whether the relevant growth sectors have entered the inflection point of repair.
Haitong Securities Company Limited(600837) chief strategist Xun Yugen believes that from a round of economic cycle and stock market bull bear cycle, the market probability has entered the bottom area. How the market can deduce from the initial rebound at the bottom to the reversal can refer to five indicators: the year-on-year change of social financing stock / loan balance (reflecting monetary policy), the cumulative year-on-year change of infrastructure investment (reflecting fiscal policy), PMI / PMI new orders (reflecting manufacturing industry), the cumulative year-on-year change of commercial housing sales area (early cycle industry), and the cumulative year-on-year change of automobile sales (early cycle industry).
Xun Yugen said that drawing lessons from history, the signal of rebound to reversal is that at least three of the five leading indicators of fundamentals have stabilized. In the first quarter of this year, the financing policy was significantly strengthened. The year-on-year index of social financing stock reflecting monetary policy has stabilized, while the other four indicators need to be continuously tracked.
In terms of specific allocation, Haitong Securities Company Limited(600837) continues to be optimistic about the main line of “stable growth”, and proposes that in the stage of market rebound, new infrastructure sectors such as digital economy and low-carbon economy are more flexible. In addition, the large consumption sector closely related to the economic recovery also deserves attention.
