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Financial Investment News reporter Lin Ke
Although the management continues to release good news, A-shares do not appreciate it, and under the influence of multiple factors, the Shanghai Composite Index closed a decline of 627% of the negative line, ** the decline is even greater. However, in this situation, the policy is continuous, but the market has its own laws.
From the point of view of many institutions on the February A** field, with the continuous fermentation of favorable policies, coupled with the release of credit funds in the new year, coupled with the negative impact of the performance forecast, the pessimism is quickly released, and there is an expectation of further improvement.
>>>Everbright**: Spring is expected to come gradually
Compare the current market with past bottoms from two dimensions, one from a fundamental perspective with 2022 and 2023, and the other from an extreme case perspective with past market dips below 2,800 points. From a fundamental point of view, looking back at the fundamentals from 2022 to the present, the epidemic and the economic recovery after the epidemic are still an unavoidable background, but in comparison, the fundamentals in 2024 are likely to improve, and judging from the recent economic data, the downward pressure on fundamentals is gradually easing. Judging from the extreme situation of the low operation of the A** market in the past, the operation of the Shanghai Composite Index at a low level is usually accompanied by weak fundamentals and some risk factors, while the downward pressure on the current fundamentals is not significantly higher than in recent years, and the current risk factors faced by the market, such as the liquidity pressure caused by the liquidation of short-term structured products, are expected to gradually ease with the support of policies.
In terms of market structure, from the perspective of the macroeconomic environment and market environment, the high-dividend strategy can still be used as the bottom position for stable income, and the current valuation and crowding of high-dividend assets are not high, and it still has a certain allocation value. In addition, various policies to stabilize growth and stabilize the market have been frequently introduced recently, and some of them have relatively clear directions, such as central enterprises, stable growth, and high-level reform and opening up in Pudong New Area, which may also be worth paying attention to. Moreover, if there is a short-term market, the sector with a large amplitude in the early stage may be more resilient in the process. Therefore, the growth sectors with large adjustments in the current round of market adjustment are also worth paying attention to.
On the whole, after the adjustment of the market in the early stage, the current market has a high cost performance, and the superimposed policies continue to exert force, and the spring of the A** field is expected to gradually come. And, historically, A-shares have generally performed better in February. Therefore, multiple positive factors are superimposed, and the market is expected to bottom out and fight back. It is expected that the market style in February may be between balanced and pro-cyclical, and it is recommended to pay attention to petroleum and petrochemical, non-bank finance, pharmaceutical and biological, media, basic chemical and electronic industries.
>>>China Securities Construction Investment**: Pay attention to the policy force
At the macro level, the "economic bottom" is expected to appear in the first quarter under the pressure of a high base, and the current signals such as the unexpected RRR cut indicate that the monetary policy has begun to turn, and the opening up to the outside world has expanded simultaneously, and the follow-up fiscal policy is concerned about the force. At the capital level, the net outflow of northbound funds has slowed down, and there have been signs of reversal; Since the beginning of the public offering, there has been a certain reduction in positions, but there is still pressure on the chip structure of some industries in the short term.
From a micro point of view, combined with the disclosed industry situation, it is expected that the year-on-year profit of all A in the fourth quarter is expected to achieve positive growth under the low base effect, among which, the pharmaceutical, electronics, and communication sectors have improved significantly from the previous quarter; financial real estate consumption is under pressure; High-end manufacturing is differentiated, and the supply and demand structure of the industry in 2024 leads to low expectations; Earnings expectations in the direction of the high dividend cycle are relatively stable, the growth rate of coal performance has declined, and the high-speed annual turnaround is expected to continue to improve; The early rectification of the industry has been cleared, the profit has improved significantly, and some industry policies have also been corrected, including education, games, etc.
In terms of allocation suggestions, the policy and confidence stabilized before the recommendations were still based on low valuation + high dividends; After the market stabilizes, as the performance of the technology industry cycle is realized, it is expected to further relay in the future, and the valuation of core assets is also expected to gradually recover. It is recommended to pay attention to the first is the leading central enterprises in the low valuation cycle that are too pessimistic about growth and seriously depressed valuations in the early stage, including real estate, construction, banking, nonferrous metals, communications, etc.; The second is that the technology sector has catalyzed more in the first quarter, and it is expected that the performance in the first quarter is expected to be realized: continue to recommend the consumer electronics industry chain, AI industry chain, storage and other technology sectors; The third is core assets, with the recovery of market confidence, the valuation of core assets is also expected to revert to the mean, and foreign capital is expected to make up for a certain amount, including consumption, medicine, new energy leaders, etc.
>>> Zhongtai**: Value style or dominance
The market value management of central enterprises is a catalyst for value dominance, but the core is still "weak macro expectations". Since 2015, another manifestation of the relative growth of value has been the relative outperformance of the dividend index, historically, there are two macro environments in which the dividend index has outperformed, one is the contraction of economic growth and inflation conditions, and the other is the contraction of monetary policy conditions. Among them, the expectation of the economy can be further refined into the expectation of the real estate boom. Therefore, "weak macro expectations" can be split into growth expectations, ** expectations and policy expectations. Unlike in the past, the outperformance of the dividend index began in April 2023, during which the above two expectations were weak.
For February, the value and dividend style will continue to prevail, mainly because the current policy strength may be difficult to meet the conditions for the expected correction. First of all, in terms of real estate policy, the optimization of home buyers' balance sheets needs to be strengthened. Since there is also a feedback effect between the demand for housing and the real estate boom, based on the current weak real estate market, we tend to increase the demand for real estate and may need more policy guidance; On the macro front, the current level of real interest rates is the second highest since 2010, and a higher level of real interest rates will limit the expansion of demand, which in turn will lead to a lack of effective demand and a decline in macro **. If the stage target of the follow-up monetary policy focuses on the domestic price level, it will require greater policy support, and under the current high real interest rate level, we tend to continue the short-term macro ** downward trend; In terms of fiscal policy, the market has been expecting fiscal policy to exert force, and we tend to have a lower chance of follow-up space than expected. First, China's fiscal policy has been strong since the epidemic. Second, the high local stock debt may restrict the space for further fiscal policy.
>>> Cinda**: Pay attention to key signals in the market
Since February 2023, most of the previous market events have lasted two weeks to one month, so most investors are still worried about the continuity of **. In our view, the key signal for the upgrade from ** to reversal is that there is a "short-term unfalsifiable logic" of annual earnings improvement, focusing on real estate policies and sales; In addition, observe whether the old tracks such as new energy can stabilize and strengthen. The drivers of previous bull markets have mostly been different, and the important drivers of previous bull markets were real estate and new energy. The weakening of these two forces is one of the core reasons for the emergence of bear markets, and the first quarter of the market reversal at the beginning of the end of the bear market mostly requires the easing of these bearish logics. After the market reversal, the logic of other industries will slowly become the real main line. When the bull market enters the medium term, even if the fundamentals of real estate and new energy deteriorate again, the impact on the market as a whole may be limited.
In the short term, the old track that has overfallen may have a quarterly counterattack, and the allocation order is upstream cycle, AI, auto auto parts, financial real estate, old track, and consumption. Historically, near the bottom of the big ** or reversal, there will generally be the following characteristics, the first is in the long-term style of the small market stage (such as 2008-2016), if the index has a bottom reversal, the small market style may be phased retracement or stagflation, ** style tends to be stronger; The second is that after the end of the bear market, the first wave will have the shadow of the previous round of bull market, and the new energy that performed last week is precisely the strongest direction of the previous round of bull market; The third is that the bottom has just reversed for two to three months, and most of the sectors with the largest gains are over-falling sectors, such as the strongest new energy semiconductors after the reversal at the end of April 2022 and the strongest consumption after the reversal at the end of October, which are the weakest in the previous half year. But the strongest sectors near the bottom reversal have little correlation with the strongest direction in the coming year.
>>> Ping An**: Market opportunities outweigh risks
In terms of economic fundamentals, the U.S. economy is resilient, and the domestic economy continues to recover weakly. The U.S. economy remains resilient, with a U.S. manufacturing PMI of 47 in December 20234. There has been a rebound; U.S. CPI grew year-on-year** to 34% with an expected value of 32%, the previous value was 31%；The year-on-year growth rate of core CPI was 39%, higher than the expected value of 38%, slightly lower than the previous value of 4%. The domestic economy continued to recover weakly, with a year-on-year growth rate of 23%；weak recovery in consumption; In December 2023, fixed asset investment increased by 3%, the growth rate of manufacturing investment continued to pick up, and the growth rate of infrastructure investment rose to 824%, and the growth rate of real estate development investment was -96% is still the main drag, real estate sales and new construction are still declining; Prices are running at a low level, and the CPI in December 2023 fell by 03%。
In terms of liquidity, overseas interest rate cuts are expected to be repeated, and domestic RRR cuts have stabilized confidence. The market's expectation of a Fed rate cut in 2024 has intensified. The 10-year Treasury yield rose to 4 amid increased uncertainty about the Fed's interest rate cut in 2024 amid the resilience of the U.S. economy and higher-than-expected inflation**15%, up 20 basis points from the beginning of the month, the dollar index increased to 10347, USD/CNY exchange rate** to 718。The domestic RRR cut has stabilized confidence. The total amount and structure of financial data in December 2023 are still weak, and the central bank announced that it will reduce the reserve requirement ratio of financial institutions by 05 percentage points. Northbound funds continued to have a net outflow, and market activity bottomed out; In January, the net outflow of northbound funds was 193600 million yuan, an increase from the net outflow of the previous month; The market turnover rate continued to decline to 29%。
In terms of allocation strategy, it is recommended to intensively deploy the policy of stabilizing confidence, and the overall opportunities in the current equity market still outweigh the risks. On January 24, the management proposed to protect the legitimate rights and interests of small and medium-sized investors from various aspects. With the implementation of the new round of RRR cuts, the monetary policy cycle gap between China and the United States tends to converge, and China's monetary policy operation autonomy has increased, which is conducive to broadening the monetary policy space and focusing on stabilizing the market and confidence. The market is expected to get out of the short-term troubles with policy confidence. In terms of structure, the first is a dividend strategy that directly benefits the policy; Second, it is good for central state-owned enterprises that also benefit from central enterprises that emphasize investor returns; Third, it is good for the first white horse with stable performance and standardized information disclosure.
>>> Galaxy**: Balanced distribution of value stocks
In terms of policy, the introduction of a series of policies has had a certain effect on market expectations, such as the comprehensive RRR cut, the China Securities Regulatory Commission's proposal to "build an investor-oriented capital market", the State-owned Assets Supervision and Administration Commission's proposal to further study "incorporating market value management into the performance appraisal of central enterprises", and the Ministry of Housing and Urban-Rural Development to "fully give urban real estate regulation autonomy". These policies have had a certain positive impact on market sentiment and expectations. As the effect of macroeconomic policies continues to emerge, domestic consumption gradually recovers, and the profit growth of industrial enterprises accelerates significantly, the domestic economy will stabilize and recover. Overseas, although the Fed has not officially ended the interest rate hike cycle, which has caused a certain disturbance to the A** field, the Fed is about to enter the interest rate cut channel and is expected to usher in the first interest rate cut in the second half of 2024. In the context of the expectation that the Federal Reserve will cut interest rates, it will be good for the world, and have an impact on the US Treasury yield and the US dollar index, thereby reducing the pressure on the RMB, and the exchange rate factors that constrain the ** have been alleviated. The resonance of internal and external positive factors has formed a support for A-shares.
Investor confidence is expected to regain amid volatility in February. After the ups and downs of 2023, the internal and external negative factors have basically been digested, considering that the current A-share is at the bottom of the valuation area, 2024 is expected to usher in the recovery of confidence and attract capital inflows under the favorable conditions at home and abroad, and A-shares are expected to usher in the upward repair in 2024. An important national meeting will be held in early March, and considering that A-shares usually show positive performance before important meetings, policy drive is one of the key points to focus on, and it is necessary to wait patiently for the catalyst on the policy side to regain investor confidence. The investment strategy allocated in February should focus on low-valuation value stocks + growth value stocks in the sector that benefit from policy assistance + favorable policies of the two sessions. It is recommended to have a balanced distribution of value stocks in sectors such as aviation, banking, technology, coal, and power.
>>>IFC**: Lack of confidence is a potential risk
The "spring restlessness" of A-shares may be about to begin. As long as the "easy currency" in the first quarter of this year, whether before or after the Spring Festival, it is equivalent to providing a currency hedging for the potential risks in the second quarter, which means that even if overseas risks and real estate risks are gradually exposed in the second quarter, the impact will be relatively controllable. This will effectively manage market expectations and promote the restoration of market confidence, knowing that there has been a significant change in fundamentals below 3000 points? Has there been a significant change in liquidity, RMB exchange rate, etc.? No, it's just that MLF didn't cut interest rates lower than market expectations. Obviously, the fall of 2900 to 2700 points is confidence, and there is a lack of confidence in the uncontrollable potential risks in the future.
At present, the central bank has not only released the "easy money" signal, but the regulator has also cooperated with the introduction of the "new regulations on operating property loans" and held a deployment meeting of the city's real estate financing coordination mechanism, which will help reduce the drag of real estate risks on macroeconomic and market confidence. We judge that the future ** will not only be over-falling**, but also logical, core-driven and sustainable**, that is, the long-awaited "restlessness**" opens, and the core driving force behind it is the recovery of liquidity and risk appetite. Considering that even "easy money" is difficult to "ease credit" in the short term, and the fundamentals will not improve significantly or even weakly due to the current easy money, at most the potential risk can only change from large to small, therefore, the duration is limited, about one to two months, March or when volatility rises, it is recommended to be cautious.
In terms of market style, we judge that although the first-class value represented by the short-term "medium and special valuation" benefits from the valuation logic of the "market value assessment of central state-owned enterprises", it is expected to usher in thematic opportunities; However, considering that the macro environment in the first quarter of 2023, including the "double improvement" of the economy and liquidity, is different from the current domestic economic slowdown and only the marginal repair of liquidity, this means that the sustainability of the "medium and special stocks" theme investment may be limited. On the contrary, in the current macro environment, the growth style is likely to benefit most from the increase in liquidity and risk appetite. In addition, based on the analysis conclusion of our large and small cap framework, in the context of "easy money" and not "easy credit", new funds are still limited, and under the expectation of marginal repair of liquidity, the "small boat" will float first, and the small and medium-sized caps will be more advantageous.
In terms of industry allocation in February, it is recommended to focus on the direction of economic structural transformation, including: electronics, automobiles, mechanical automation, medicine, etc., and focus on the AI direction catalyzed by themes, especially consumer electronics that are over-falling in the short term; the second is to adapt to the brokerage to enhance the flexibility of the portfolio; The third is to configure the alpha combination with strong overseas logic to smooth the fluctuation of the combination.
>>> people's livelihood**: TMT or upward revision**
At present, as the two ends of the "dumbbell" configuration, the differentiation between TMT and central state-owned enterprises and dividends has reached a high level in recent years. Therefore, if the "Chinese prefix" has undergone a relatively full diffusion and fermentation, TMT may once again usher in a rotational upward repair**.
It can be seen that the recent "Zhongzitou" sector has been concentrated under the policy catalysis. On the one hand, for the market as a whole, it has injected a "shot in the arm" for the recent downturn and boosted risk appetite. On the other hand, in the current stage of chaos and lack of direction, it provides a rare breakthrough and breakthrough direction. Looking ahead, as an extension of the direction of dividend low wave, the "Zhongzi prefix" can pay attention to the direction of rotation and diffusion within the plate in the future. For example, cement, insurance, operators, construction and steel, which are not currently crowded and still have low valuations.
With the overall recovery of market risk appetite and the end of the performance pre-disclosure window, TMT, which is catalyzed by both prosperity, profit growth and industrial trends, is expected to become an important main direction in the subsequent market recovery stage. In terms of subdivided industries, it is recommended to pay attention to the "five golden flowers" of TMT, optical modules, consumer electronics, games, optical components, and semiconductors.
>>>China Post**: It is expected to gradually be positive
Judging from the recent market situation, continuous favorable policy stimulus and over-the-counter bailout funds are the main factors driving this market. Multiple benefits, including the central bank's RRR cut to release a loose monetary signal, the regulator's multiple measures to protect the market, and the continuous development of real estate stability policies, have effectively boosted market sentiment. Looking ahead, recent economic data shows that the domestic economy is still weak, and the profits of industrial enterprises will continue to maintain a high growth rate in December 2023, but the overall economic growth rate and social zero in the fourth quarter are lower than market expectations; Therefore, although a series of positive policies have been intensively introduced, the pessimistic expectations of the market on fundamentals and policies in the early stage have not been fundamentally reversed, and the market is still waiting for the verification of the effect of policy implementation and the improvement of fundamentals. At the same time, the U.S. economic data exceeded expectations and the Federal Reserve's hawkish remarks made overseas markets continue to correct the overly optimistic interest rate cut expectations in the early stage; The disturbance of superimposed geopolitical risks still exists, so the follow-up market may still show a leading trend.
In addition, the current market valuation is at a historical bottom, and the overall economic growth target of the local two sessions is relatively positive, and the increase in the implementation of the stable growth policy at the beginning of the year, the continuous efforts of the real estate stabilization policy and the loose monetary environment may promote the gradual recovery of the overall economic fundamentals, thereby boosting the overall risk appetite of the market. Therefore, we believe that the adjustment of the recent market should not be overly pessimistic, and the follow-up market is expected to gradually become positive.
In terms of allocation, it is recommended to pay attention to the central enterprises that benefit from the reform policies of central enterprises and have high dividend attributes in finance, petroleum and petrochemical, communications and other Chinese prefixes; It is recommended to continue to pay attention to the scientific and technological innovation aspects that benefit from industrial policy support, including semiconductors and consumer electronics, which benefit from Huawei and AI hardware catalysis and are expected to bottom out in cycles. It is recommended to pay attention to the automobile chain with high industry prosperity and strong performance elasticity, as well as the export chain that benefits from the improvement of external demand; In addition, it is recommended to pay attention to the travel chain that benefits from holiday travel and cultural tourism.
Edit|Chen Yuhe Proofreading|Yuan Gang
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