The Financial Associated Press, November 21, this Friday, the large financial sector led by securities firms moved collectively, and the three major indexes all rose by more than 1%. Regarding the previous market situation, most institutions believe that the “winter restlessness” market has been fully launched; in terms of sectors, some institutions believe that the blue-chip main line is gradually becoming clear, focusing on varieties with low fundamental expectations and varieties with low valuations. Some organizations believe that value stocks represented by consumption are only repairing rather than reversing, and the main line of the market lies in technological growth.
CITIC Securities: Blue-chip main line is gradually clear
Since entering the fourth quarter, the economy has started a recovery period, policies are in a waiting period, stock investors are still in a period of hesitation, and the main line of the market has entered a period of incubation. With the economic recovery, the policy signals are clear, and the continuous inflow of incremental funds drives the gradual increase of stock funds. , The main line of the market for the return of blue chips will be clearer. First of all, the economic highlights are mainly in midstream manufacturing and consumption. Exports continue to boom. The recovery of midstream manufacturing and consumption drives the economy to improve quarter by quarter starting in the fourth quarter. It is expected that related measures to stabilize real estate are being launched intensively. Compared with the global perspective, the location of China’s economy is less risky and more attractive. Secondly, the direction of stable growth at the policy level is determined. The December Central Economic Work Conference is expected to release a clearer signal. During the waiting period for policy signals, macro liquidity will continue to remain reasonably abundant and fiscal affairs will be more proactive. Finally, although stock investors are showing signs of lightening their positions under the influence of economic worries, incremental funds have been diverted to the equity market recently, and it is only a matter of time before stock investors’ hesitation is reversed. In terms of configuration, it is recommended to resolutely lay out the blue-chip main line around the “three lows”, focusing on varieties with low fundamental expectations, varieties with low valuations, and high-prosperity varieties with relatively low stock prices after adjustment.
Huaan Securities: Fast-track layout to stick to the track of strong growth
In the spring, the restlessness moves forward, the next year’s start-up will be advanced, and the layout will continue to stick to the strong track plate with high prosperity. First, the sixteen-year growth review shows that after the performance support, there is still a round of opportunity for the growth style to bubble up the valuation. It is judged that the market is gradually entering this market and should be actively grasped. The second is that the central bank will continue to produce 1 trillion MLF on November 15. Although the probability of a RRR cut in the fourth quarter has dropped, considering that the first quarter of next year will be the stage of greatest economic growth pressure, the rhythm is expected to be relatively loose and liquidity Relatively loose levels will support valuation. The current configuration will continue to shift to the strong growth track, focusing on photovoltaics, wind power, energy storage, and the new energy vehicle industry chain under the concept of green power, and focus on the technology semiconductor sector; in terms of consumption, continue to focus on those that benefit from the alleviation of core shortages. Cars; at the same time, continue to deploy cost-effective banks. In terms of themes, focus on the dual-carbon policy-supported and long-term prosperous military industry.
Guotai Junan: New Year’s Eve Markets Slowly Expand Consumer Sector Will Become the Most Definite Main Line of the Mid-term Market
Financial rebound: the pioneer of the New Year’s Eve market. As the New Year’s Eve market is approaching, we maintain the judgment of “standing at the starting point of style switching” and “low valuation harvest season” since the beginning of October in terms of structural configuration. The current real estate problem is the biggest obstacle to the start of the financial sector. Real estate data accelerated in October and there was no sign of stabilization in corporate financing. Supply and demand have continued downside risks. However, the pessimistic expectations of real estate have gradually eased recently: 1) On the 12th, the central bank and the China Banking and Insurance Regulatory Commission once again mentioned “maintaining and promoting the healthy development of the real estate industry”, and the signal of maintaining stability in the policy has become clearer; Corporate bond financing channels are expected to gradually recover; 3) Demand-side financing has also eased, and new personal housing loans increased in October from the previous month; 4) At the local level, Harbin and other places have successively introduced loosening and fine-tuning policies. We expect that the real estate policy is still expected to be further marginalized, but it is not deviating from the framework of “housing to live without speculation”, but focusing on delivering “running water” to the supply side to improve the financing environment, unblock the internal operation of the industry, and alleviate the risk of real estate’s balance sheet recession. With the gradual improvement of real estate expectations, the rebound of the financial real estate sector will become a path for the new year’s market.
Consumption switching: an important main line in the mid-market. What are you worried about in the consumer sector? The market believes that the pace of demand-side repair under the uncertainty of the epidemic is difficult to grasp → weak demand also makes cost transmission difficult to smooth → concerns about both volume and price, and it is not the preferred direction to approach the end of the year. However, we believe that the market underestimates the upward possibility of CPI in the next stage: 1) In addition to the demand side, cost pass-through also depends on the improvement of the competitive landscape. The current midstream manufacturing and downstream consumption competition landscape is significantly improved compared with the past, and the cost transmission will be more than 2016- 2017 is smoother; 2) The current global CPI inflation has entered a new stage. The October CPI of the United States, Britain, Germany and other countries reached 6.2%, 4.2% and 4.5% year-on-year respectively, and the pressure of overseas imports also boosted the upward trend of CPI. 3) In addition, there is no need to worry too much about the demand side. Resident income continued to grow in the third quarter, and rural labor migrants basically recovered to the same period in 2019. Consumer income confidence/expectation index stabilized and rebounded in September. With the CPI’s higher-than-expected upward trend, the consumer sector will become the most certain main line of the medium-term market.
Industry configuration: high economic prosperity + financial rebound, medium-term consumption switching will be seen. 1) Financial rebound: securities firms/banks/real estate; 2) consumer electronics: the high-prosperity direction is still scarce, and the focus is on the device side of the meta universe. Currently, Metaverse promotes the accelerated popularization of VR devices, and the cumulative sales of Oculus Quest 2 have reached 10 million units. According to IDC forecasts, shipments of VR headsets will increase from approximately 5 million units in 2020 to more than 28 million units in 2025. 3) Looking at consumption switching in the mid-term: gradually stepping out of the expected bottom, recommending liquor/live pig/dairy/auto parts and other industries.
Haitong Securities: The restless market at the end of the year is expected to unfold
Core conclusions: ① The excess returns of various industries relative to the broader market are ranked differently at different stages, and the industry configuration seeks to find industries with the highest excess returns at different stages. ②The RRG chart can describe the cyclical law of excess returns in various industries, and reflect the law of about 2 months and 2 quarters according to daily and weekly data. ③The lenient credit policy is gradually implemented, the restless market at the end of the year is expected to unfold, the structure is expected to be balanced, the big finance and hard technology are better, and the consumption is rising.
Essence Securities: Policy expectations are overweight and focus on grasping opportunities for valuation restoration in low-value sectors
We believe that the fall in commodity prices, the Fed’s moderate Taper, and the phased relaxation of Sino-US relations have laid the foundation for the start of a new round of A-share market. In the future, the main contradiction in the market will be shifted from “quasi-stagflation” to “recession mode”, policy orientation tends to be looser, and the direction of policy force is expected to be: fiscal force is preceded, monetary policy “self-centered” more flexible, Credit issuance to stabilize total volume and restructure. In terms of time, the central political bureau meeting and the central economic work conference in mid-December will set the tone for next year’s economic policy, and the disclosure of financial data in November will be the key to clear economic stimulus policy expectations.
The most important of these is that we are about to enter a new round of “wide credit” cycle characterized by “stable total volume and wide structure”, and we can look at the market more optimistically. We believe that in the early stage of wide credit, valuation restoration of low-valued sectors is expected to become the main line of the market. The main reasons are the marginal recovery of domestic real estate policies, the stabilization and rebound of social financial growth, and the preference of funds for low-value sectors at the end of the year. With the confirmation of the wide credit policy, high-prosperity and long-track growth stocks represented by the Ning Group are expected to relay the follow-up market and drive a new round of market growth. Themes such as small and medium-sized cap growth and meta universe will also be active again and again.
Configuration: The current focus is on grasping the valuation restoration opportunities of the undervalued sector, including undervalued small-cap stocks, and financial real estate-non-banking/banking/real estate/building materials/home appliances (policy margins are relaxed, midstream cost pressures are reduced), communications/ Opportunities for valuation restoration in consumer electronics (business transformation), food and beverage (expected price increases) and other sectors. Continue to hold the high-prosperity long track represented by the “Ning Group”, including photovoltaics, new energy vehicles (auto parts, lithium resources, lithium batteries), semiconductors (high-end chips/equipment), military industry, etc.
Zheshang Securities: Value is only the main line of repair and growth
In the recent market, whether it is style rotation or structural performance, it seems that the direction is relatively scattered, and the main line is not clear enough. How to see the style and structure interpretation of the follow-up market?
1. Value is only repair, growth is the main line
Combining the macro environment and industry trends, we believe that in 2-3 quarters, the value stocks represented by consumption are only repairing rather than reversing, and the main line of the market lies in technological growth.
(1) Macro environment and style rotation:
According to the law of resumption, there is a strong correlation between the macroeconomic environment and market style. We use “M2-nominal GDP growth rate” to characterize “surplus liquidity”, and we can find that when the surplus liquidity is improving upward, the style is biased towards small and medium growth stocks; when the surplus liquidity is falling downward, the CSI 300 is used as Representative procyclical large-cap stocks dominate.
Looking forward to the follow-up, combined with the 2022 outlook of the macro group, looking at the time dimension of 2-3 quarters, we expect that the remaining liquidity is expected to improve upwards. Under this background, the style is biased towards small and medium growth stocks.
(2) Consumption restoration and promotion of science and technology innovation:
For consumption, the previous oversold and valuation repairs will be restored at the beginning of the fourth quarter. However, based on the fundamental background, the overall situation is hard to reverse; for technology growth stocks, on the one hand, the macro background has begun to enter a window that is conducive to growth stocks. On the other hand, the structural bull market represented by semiconductors and national defense has become dominant after the third quarterly report landed.
2. Industry configuration: attach importance to semiconductors and national defense
First, the strategy attaches great importance to the bull market in science and technology innovation. Semiconductors lead the science and technology bull market, and subdivide the track to focus on semiconductor analog design, IGBTs, and equipment materials.
Second, actively deploy national defense equipment. Combining the viewpoints of the machinery group, focusing on the main engine plant, related companies include AVIC Xifei, Hangfa Power, and Hongdu Aviation.
Third, the new energy chain is diverging. In combination with the law of industry chain transmission, follow-up should focus on the middle and downstream links, such as energy storage and automobile intelligence.
Fourth, the traditional industry structure is dominated. On the one hand, the CPI chain represented by mass consumption and agriculture, forestry, animal husbandry and fishery; on the other hand, the epidemic-damaged sectors represented by airports, airlines and hotels.
Tianfeng Securities: In the medium term, it is still a small- and medium-cap style dominated by emerging economies
① From the perspective of base effect: the low base effect of small-cap stocks will mostly disappear next year, with the exception of the “dilemma reversal” sector next year.
②From the perspective of incremental economy: The incremental economy promoted by “hard technology” is likely to continue. This level will still support the continued dominance of the performance of related sectors, but the internal division of the sector requires focus on the direction in which the prosperity can continue.
③On the other hand, whether the performance growth of the blue-chip market can rise next year, the core also depends on the credit expansion of the traditional economy next year. At present, the policy tone is likely to continue the structural expansion of emerging economies, while traditional economies such as infrastructure and real estate are more underpinned expansion or quarterly pulses. Performance determines the style, which means that next year, there may be a phased market that will have the upper hand in the blue chip market, but in the medium term, it will still be a small- and medium-cap style dominated by the emerging economy.
Therefore, in terms of configuration, we are still optimistic about the two types of assets that will dominate next year’s performance: First, in the logic of the base effect, we recommend the sectors that will “reverse the dilemma” next year: automobiles and parts, pork, mandatory food, travel and so on. Second, in the logic of incremental economy, recommend the “hard technology” sectors related to the planned economy and sustainable prosperity, such as photovoltaic, wind power, military, energy storage, and new energy operators.
Yuekai Securities: Seize the dual mainline opportunities of growth + consumption
In terms of the market, this week’s major A-share indexes showed turbulence and differentiation, and the consumer sector rebounded significantly, superimposed on the strong rebound of the real estate sector, which drove the Shanghai Index to rise significantly. The transaction amount increased month-on-month but not much, indicating that the current market is still dominated by the game of stock funds, and the plate rotation is still fast. The Shanghai stock index has two consecutive positives on the weekly line. After Friday’s rally, the upper part is facing the suppression of the quarterly line. We believe that the market outlook is expected to continue to rise amidst the fluctuations in conjunction with the trading volume. Continue to be optimistic about the dual main lines of growth + consumption:
1) Stick to the allocation opportunities in the high-prosperity and high-growth sector. In the long run, the future policy direction will continue to focus on cultivating and supporting a number of high-end manufacturing companies with global competitive advantages. The current growth sector continues to maintain a high degree of prosperity. The third quarter report performance of semiconductor, new energy vehicles, photovoltaic equipment and other sub-sectors still maintains rapid growth. Superimposed fourth quarter monetary policy is expected to shift to marginal easing, benefiting from long-term policy support + high prosperity + liquidity With loose margins, it is recommended to continue to pay attention to investment opportunities in the high-prosperity high-end manufacturing direction represented by new energy and semiconductors.
2) Focus on exploring high-quality low-end products, especially low-sucking opportunities in large consumer sectors. Inflation data in October exceeded market expectations again, with PPI as high as 13.5%, CPI at 1.5%, and the PPI-CPI scissors gap reached a historical extreme of 12%. With the start of the consumer sector price increase, companies with strong pricing power and brand advantages are expected to take the lead in benefiting. Leading companies are expected to enjoy the benefits of a fall in raw material prices + elastic recovery of profits in the medium and long term after the pressure on the cost side of leading companies is gradually eased. In 2022, Leading consumer products companies are expected to welcome Davis double-click on valuation and profitability. It is recommended to pay attention to high-quality large consumer leading companies with alpha attributes.
Qianhai, East Asia: “Winter Restlessness” market has been fully launched
Looking back at history, there is basically a round of turmoil in the A-share market at the beginning of each year. The turmoil since 2016, the stabilization of the macro economy, the improvement of liquidity expectations and the warming of market risk sentiment are the main influencing factors that catalyze the turmoil in the market. The traditional “spring turmoil” stems from the impulse of credit issuance, the warming of macro policy expectations and the increase in market risk appetite during the data vacuum period. From a structural point of view, the hotspots of market turmoil over the years may not be the main line of the whole year’s market, and investors need not be overly entangled in the so-called “main line of market.”
In recent years, the phenomenon of turbulent market leading has become more and more obvious. In recent years, as the pace of year-end deployment of Northbound funds has accelerated, and the voice of professional investors in the market has risen, the pre-existing phenomenon of the spring market has become more and more obvious. From the point of view of time, the restless market before 2017 mostly started at the beginning of the following year, and starting from 2018, the starting rhythm has been moving forward. The 2018 market start time is mid-December 2017, the 2019 market starts at the end of 2018, the 2020 market starts at the beginning of December 2019, and the 2021 market starts at the beginning of November 2020. The learning effect of the market makes the “spring market” gradually Evolve into “New Year’s Eve Quotes”.
This year’s restless market started earlier than previous years, but the new year’s market is more difficult. We pointed out in the report “From “valuation switch” to “winter turmoil”” that with the acceleration of credit and fiscal policies, the pace of seasonal easing of macro liquidity this year will be significantly earlier than previous years; from the perspective of corporate earnings, the third quarterly report After the market is expected to form a new consensus on the mid-term profit trend of the main line sector; from the perspective of risk appetite, the G20 summit in late October and the United Nations Climate Change Conference in early November, and the implementation of Taper in November are expected to be important to promote the improvement of market risk sentiment catalytic. Afterwards, the Wonderfull A Index reached the current round of market adjustment low of 5574 on September 29 and began to gradually rise, and the “winter restlessness” market started as scheduled.
“Winter restlessness” is difficult to evolve into the New Year’s Eve market. With the gradual unfolding of the recent “winter turmoil” market, some more optimistic investors have begun to look forward to the future New Year’s Eve market. We believe that the difficulty is greater regardless of historical data or the current macro environment. First of all, from historical data, the longest duration of the spring market turmoil in the past 12 years was 72 trading days, with an average duration of 40.8 trading days. If the “winter turmoil” launched in October this year crosses to the beginning of next year, it will reach 64 trading days. , Is the second in history. Judging from the current market environment, with the recurrence of global pandemic turmoil, the supply chain is difficult to effectively alleviate in the short-term. The transmission of PPI to CPI makes inflationary pressure gradually appear, and the uncertainty of the profitability of some high-growth sectors to switch to the long-term rises. This allows investors to revise their mid- and long-term investment goals. And these worries are likely to gradually emerge in the next annual handover process.
Standing at the present moment, the “winter restlessness” market has been fully launched. Investors should not be overly constrained by the so-called “main line of the market”, but should grasp the internal logic of promoting the market. The main line of the market structure will be restored based on the valuation of traditional industries (food and beverage, home appliances, finance, building materials, real estate) → the valuation of industries with greater elasticity of profit expectations (agriculture, textile, paper, chemical medicine and other essential consumer goods and information, energy infrastructure) →The order of increasing the valuation of high-prosperity racetracks (new energy vehicles, green electricity, military industry) is gradually unfolding.
Caixin Securities: The market enters the shock and the end of the market has strong momentum for switching styles
Taking into account the 1-2 quarters leading time lag of global liquidity to commodity prices and the synchronization relationship between commodity prices and the economy, we believe that the period of rapid upward movement in commodity prices has passed. It is expected that China may be in a stage of marginal decline in inflation and weakening of the economic climate in the fourth quarter. At this stage, it is recommended to allocate assets from the following four main lines: (1) Financial sector. At present, the valuation of track stocks has far exceeded that of other sectors, and there is a strong demand for supplementary growth in the financial sector with low valuations, especially the brokerage sector. (2) Countercyclical sector. In the fourth quarter, the margin of demand for exports and replenishment of inventories weakened. Under the macroeconomic cross-cyclical control, the countercyclical sector may perform. (3) Sectors damaged by the epidemic. As vaccination continues to increase, the damaged sectors of the previous epidemic will usher in valuation restoration, and attention can be paid to aviation, airports, hotels, restaurants, tourism, cinemas and other directions. (4) Low valuation sector. In the fourth quarter, U.S. Treasury yields may continue to rise, and the market will pay more attention to the matching of valuations and performance. Highly valued institutional groups may usher in adjustments, and low-valued sectors can be used as a bottom position defense, and can focus on real estate, Public utilities, media.