On December 5, the CSI 300 fell 19%, after a month and a half, the Shanghai Composite Index fell below 3,000 points again. Where does the huge lethality of 3,000 points come from?First, Moody's downgraded its outlook on China's credit rating to negative from stable. Second, the US House of Representatives passed a motion to close down the Hong Kong Economic and Trade Office in China. Third, the new regulations on electric vehicle tax credits in the United States for China's electric vehicle industry chain have been re-fermented. The 53rd time it fell below 3,000 points, in fact, the integer psychological barrier is not a big deal. Not afraid to fall below 3000 points, by releasing the inner momentum in exchange for investment opportunities, this is the basic law of a weak market.
On December 5, the three major A-share indexes opened low, and the Shanghai Composite Index weakened to 3,000 points in early trading, and then saw around the pointThe Shenzhen Component Index and the Growth Enterprise Market (GEM) continued to declineIn the afternoon, brokerage stocks moved, leading the market for a short time, but it could not be sustained, and the three major indexes collectively fell by nearly 2% at the end of the session.
As of **, the Shanghai Composite Index was reported at 29723 points, down 167%；Shen Cheng index reported 947036 points, down 197%；GEM index reported 18711 point, down 198%。CSI 300 closed at 339455 points, down 19%
The total turnover of the Shanghai and Shenzhen stock exchanges was 8224900 million yuan, a decrease of 3 from the previous trading day4%。Northbound funds actually sold 752.1 billion yuan, an increase of 42 times. There are more than 4,600 stocks in Shanghai and Shenzhen, an increase of 7% from the previous trading day.
To sum up, Tuesday's ** not only smashed through the 3,000-point integer psychological barrier, but also showed a unilateral weak market state of accelerated selling by foreign capital and 8 percent turning green.
A month and a half ago, Shanghai A fell below 3,000 points, and then the management department released a series of strong expectations and protective measures. Although because the fundamentals are too weak, no matter how many measures have not been able to give birth to even the intermediate ***, but under the care of the policy, for more than a month, Shanghai A has been between 3000-3100 points in a narrow box format.
So, what force smashed Shanghai A through the 3,000-point integer psychological barrier on December 5?
One isTuesdayMoody's downgraded its outlook for China's credit rating to negative from stable
The psychological impact of this news on Chinese investors is self-evident and should be the main reason for the sharp drop in A-shares on Tuesday.
The reason given by Moody's was the risk associated with "structural and sustained low medium-term economic growth" and the continued distress of the real estate sector. Moody's said in the report that the change reflects growing evidence that the authorities will provide financial support to cash-strapped localities** and state-owned enterprises, "posing broad downside risks to China's fiscal, economic and institutional strength."
Perhaps many investors are not convinced, believing that the world's second-largest economy is grappling with a number of economic problems at a time when the outlook is deteriorating. In an interview with reporters posted on the official website of the Ministry of Finance on the issue of Moody's Ratings' downgrading of China's sovereign credit rating outlook, the relevant responsible comrade of the ministry said: "We are disappointed. Since the beginning of this year, in the face of the complex and severe international situation, against the backdrop of unstable momentum and weakening momentum of global economic recovery, China's macro economy has continued to recover and improve, and high-quality development has been steadily promoted."
There are also excited netizens who think this is Moody's smearing China.
In fact, as a professional rating agency, objectivity and fairness are its basic survival**. The United States, which has developed better than us in the past two years, has also been downgraded by them in its sovereign rating, and it is too naïve to comment on this matter with smear.
In October, our CPI fell 0. year-over-year2%, PPI fell by 26%, and new homes** fell by 06%, second-hand housing ** fell by 29%, rents fell by 4%, and the 5-year term deposit rate fell by 151%, the 5-year market ** rate fell by 23%。On December 4, the renminbi was 3 percent higher than the end of 2022 against the U.S. dollar4%；The renminbi is 4 per euro compared to the end of 20229%。
From consumer goods to industrial goods, from real estate to capital, commodities and assets are all in. Moody's medium-term economic growth will continue to decline, and the downside risks of fiscal and economic development are objective. And this is also the fundamental trend of the downward trend in the past two years.
The second isMeizhongDiscussionsThe hospital is closed by passingin our countryHong Kong Economic and Trade OfficeofProposals
This is news that has been overlooked by many investors, but will have a big impact on our macro economy.
As we all know, members of the US House of Representatives began to introduce the bill as early as last year. But it wasn't until the end of last week that the U.S. House of Representatives Foreign Affairs Committee passed the draft Hong Kong Economic Office Accreditation Act. China's Office in Hong Kong and the Hong Kong Special Administrative Region (HKSAR) also "strongly condemn and resolutely oppose this".
The U.S. Economic Office in Hong Kong, China, is the U.S. law that guarantees the status of the Hong Kong Economic and Trade Area, once a proposal is passed to close the Hong Kong Economic and Trade Office. In the eyes of the United States, Hong Kong will no longer enjoy special tariff treatment like other cities in Chinese mainland, or will not be able to obtain technology transfer from the United States, and all US tariff measures and sanctions against China will be extended from the mainland to Hong Kong.
The more direct impact is that we circumvent US sanctions through Hong Kong Island, and our exchanges with Russia, Iran and other sanctioned regions will be affected by this. The linked exchange rate between the Hong Kong dollar and the US dollar, and the mainland's re-exports through Hong Kong** are all direct blows.
The third isUnited StatesFor China's electric vehicle industry chainNew rules regarding the electric vehicle tax creditRe-ferment on Tuesday.
Last Friday, the United States introduced new regulations on tax credits for electric vehicles, which will certainly have a significant impact on the dominance of our country in the automotive industry in the future.
The U.S. Treasury Department announced on Friday that it would limit federal tax credits available to consumers if they buy electric vehicles made from batteries made by Chinese companies. The restriction leaves some room for U.S. companies to work with our parts suppliers, and is a deliberate step to prevent our automakers from benefiting from billions of dollars under the Inflation Reduction Act.
China exports more than 80% of the world's solar cells, and half of the total lithium-ion batteries consumed each year. China occupies a dominant position in the global electric vehicle industry. The new regulations on the tax credit for electric vehicles will undoubtedly create a greater obstacle to the export of China's electric vehicles and batteries to the United States.
3000 points is not an important technical level, but a psychological threshold that can have a strong impact on the psychology of investors, so from a technical level, it is actually not a big deal.
However, A-shares have experienced a month and a half of box consolidation, and instead of choosing to break upward, they chose to fall downward, which is a very important trend.
At the same time, we also need to note that on the official **, in the face of another drop of 3,000 points, no signal was released, let alone any disk protection actions and rescue measures, and there was even an obvious signal of a sharp decline in volume at the end of the market. Therefore, investors should maintain sufficient determination, patience and endurance for the future market outlook of A-shares.
First, from the perspective of macro fundamentals, if there is no second reform and opening up, and there is no transformation of the economic development model from the investment model to the consumption model, it will be difficult to reverse the current trend of insufficient domestic demand, shrinking external demand, oversupply, and the downward trend.
Second, it is very difficult to resolve the debt risks of real estate bonds and urban investment bonds. Although we currently arrange more than 1 trillion special refinancing bonds and more than 1 trillion special treasury bonds, hoping to resolve the risk of urban investment bonds, on the one hand, this is a drop in the bucket for the 70 trillion urban investment interest-bearing debt, and it is easy to strengthen the debt impulse of the local governmentOn the other hand, the risk of real estate bonds and the risk of urban investment bonds are embedded and intertwined with each other, but for real estate bonds, we are not willing to let go of the first control to allow real estate developers to obtain sales cash flow, and we have no willingness to undertake and resolve real estate bonds, and the risk of real estate bonds that lose cash flow has an impact risk on the future macroeconomy.
Clause. Third, the diversification of foreign investment, the trend of de-risk through near-shore outsourcing and friendly shore outsourcing is still continuing, and the outflow of capital and the transfer of production lines are undoubtedly very dangerous to the already weak macro economy, because this not only involves foreign orders, but also involves jobs and taxes.
From the perspective of macro fundamentals, the possibility of breaking through and obtaining investment opportunities is very slim, but it is not afraid to fall below 3000 points, and it is the basic law of a weak market to exchange for investment opportunities by releasing the internal momentum.
Author: Xu Sanlang].