Focus on the aggressiveness of growth in the rebound.
China US short-term cycle dislocation brings A-share rebound window, and the reversal still needs to wait patiently. This week, A-Shares still showed strong resilience on the basis of the decline of US stocks, which once again verified the view that China’s short cycle dislocation brought about the rebound window of A-Shares mentioned in our previous weekly report. On the one hand, the overseas market has gradually transitioned from austerity concerns to recession transactions, the further upward space of US bond interest rates is limited, and the constraints on A-Shares are also significantly weakened. On the other hand, the profit expectation of foreign markets in China will be reversed in stages. The most important thing is that the current market expectation for the molecular end has been at a very low level. In the game between expectation and reality, the pessimistic expectation of the A-share market has been ahead. On Friday, the central bank sharply cut the five-year LPR interest rate. The asymmetric interest rate cut has a more direct stimulating effect on real estate sales, highlighting the policy intention of the central bank to stabilize effective demand rather than fully release water. With the easing of short-term constraints, there will be a certain degree of rebound. What can really give the market medium and long-term confidence is the effectiveness of the credit easing policy. The improvement of entity expectations will certainly promote the recovery of investment demand, and the treatment of real estate risks and the easing of policies are the key to short-term credit easing.
After LPR was down regulated, the historical average performance was mainly positive. After the previous four rounds of LPR reduction, the market performance: ① from the performance of each round, the impact of LPR reduction on the market on that day is more obvious. Specifically, the main indexes fluctuated greatly on the day of reduction, and the impact gradually disappeared three days later; ② Judging from the fluctuation of the index in the current month after the reduction, the impact of LPR reduction on the market gradually subsided after one week, and the market performance has no great correlation with the short-term impact after one month; ③ From the historical average performance, the overall performance of the market after the LPR reduction is positive, and the specific positive level needs to be superimposed with the overall potential energy of the market. From the perspective of the industry, there are significant short-term markets in the commercial retail, building materials, building decoration and coal industries, and there are relative gains in the downward period of the index. This LPR reduction directly refers to the real estate industry. Considering the recent industry inclination of more direct policies and the landing of government endorsement for the reconstruction of confidence in major real estate enterprises, the real estate sector may rise in the medium and long term.
Growth rebound and value trend. The trend of the main line of stable growth and the main line of post epidemic repair is strongly in the same direction. The logic behind it is that the change of the epidemic itself constitutes the core variable of the current economic up / down, while the trend and momentum of the value style represented by post epidemic repair and stable growth have fallen in the growth rebound in recent months. The market has not effectively driven the stabilization of real estate under the background of 15bp lower than expected LPR, but has greatly boosted the whole market, especially banks and consumption, It reflects certain game characteristics within the sector. The intensive release period of stable growth policies is still on the way. Before the current profit inflection point and economic upward inflection point appear, the trend of value building has not ended. The short-term rebound and medium-term reversal of high boom growth have both advantages, and the relative score of boom during the year is not poor. With the rapid narrowing of the gap in relative valuation, the “expensive” and “cheap” valuation of the bottom area after the mud and sand no longer constitute the contradictory focus of investor allocation, showing strong rebound momentum in the short term, but the correction of profit inflection point and performance expectation has not been carried out, or it will make the rebound process difficult to achieve overnight. Judging from the medium-term perspective, The high boom growth with compound growth advantage is still in a better bottom layout area.
Risk tip: the counter cyclical policy is less than expected, and the epidemic situation is worse than expected
