CFIC Guide
Looking forward to 2022, the New Year's Eve market at the end of the year and the beginning of the year is the best window period. A shares or will usher in the consolidation of the long bull, short-term twists and turns are the power of long-term growth in savings, and do not change the general trend of China's long-term equity investment era.
Haitong Xun Yugen: Optimistic about the market window period at the end of the year and the beginning of the year
Looking forward to 2022, the New Year's Eve market at the end of the year and the beginning of the year is the best window period. A shares or will usher in the consolidation of the long bull, short-term twists and turns are the power of long-term growth in savings, and do not change the general trend of China's long-term equity investment era. As stated in the Tao Te Ching: "The song is complete, and the wrong is straight."
In 2021, the amplitude of the A-share index hit a record low, and the market amplitude in 2022 or will expand, and the market at the end of the year and the beginning of the year is considerable.
Three factors support our optimism about the spring market. First, macro policies are loose, from wide money to wide credit, and real estate policies are actively fine-tuned. Second, the current ROE is still in a recovery cycle, and it is expected that the RISE will continue until the first quarter of 2022, supporting the continuation of the bull market. Third, looking back at history, November to March of the previous year has always been a window period for the restless market.
For the full year 2022, we believe that expectations need to be lowered. At the beginning of 2019, we proposed that with the transformation of industrial structure and the migration of residential asset allocation to the stock market, A shares will be similar to the US stock market in the 1980s, opening a long bull. But long bull does not mean that there is no volatility, combined with history, the retracement in long bull may appear once every 3 to 4 years, the background is that the investment clock is in a stagflation phase.
The bull market that began in 2019 has experienced three years of growth. Looking forward to 2022, A shares may usher in a long bull break, and the disturbance factors include: inflation restricts interest rates, ROE cyclical decline and so on.
In terms of configuration, we recommend focusing on three main lines:
First, as the downward pressure on the economy is hedged and the real estate debt concerns subside, the big financial industry is expected to usher in a repair;
Second, the fundamentals of the hard technology industry are better, the stock price performance is strong, the new energy vehicle industry chain is expected to maintain a high prosperity in the next few years, and the market environment changes such as the need to digest valuation in stages;
Third, the current consumer industry profitability and fund allocation are at a low level, and the fundamentals of the consumer sector are expected to pick up in the future, and the cost performance will improve.
CITIC Construction Investment Chen Guo: 2022 Ning portfolio extension expansion
Looking back on 2021, it is undoubtedly a year for China's economy and capital market to forge ahead, but the innovation cycle and high-quality development cycle after the transformation have just ushered in the dawn. In 2022, the two major bull logics of A-shares, enterprise transformation and upgrading and resident asset allocation transfer, are still established. Therefore, we remain hopeful and cautiously optimistic about the capital markets.
If the main structural thread in 2021 revolves around the "shift from the Mao index to the Ning combination" that we proposed, in 2022, we think that new clues in the structure can still be followed:
First, the core track of the Ning group (new energy vehicles, photovoltaics, IGBT, etc.) around the main line of the era such as carbon neutrality and China's intelligent manufacturing will continue to maintain a high prosperity. In addition, with the dynamic changes of industrial development, the extension of the Ning combination is also expected to be further expanded to the military industry, energy storage, consumer electronics, and green electricity and power grids that have re-entered the growth period.
Second, the performance of the Mao index is expected to marginally improve, and the long consumption tracks such as auto parts, food and beverage, agriculture, forestry, animal husbandry and fishery are expected to usher in recovery in the context of leading price increases, the improvement of the epidemic situation and changes in the industrial cycle.
Third, a new round of technology is emerging, and new tracks of industrial iteration, such as VR/AR/MR, intelligent cars, meta-universes, and digital economies, may emerge in an endless stream of new opportunities.
In 2022, in terms of style, we believe that the small and medium-sized market in the boom is a direction that cannot be ignored. The linkage with the macro is not strong, but the opportunity for small and medium-cap investment benefiting from industrial change is rising. At the same time, the policy's support for the direction of "specialization and specialization" is also expected to be strengthened.
Grasp the main line of the times, nugget the gold boom small and medium cap. Overall, the opportunities in 2022 still outweigh the risks and challenges.
Guangfa Dai Kang: Think carefully and act
Structurally, we predict that 2022 will lead to the "mirror image" of 2021 in five characteristics. First, large-scale assets may show a combination of commodity prices slowing down, increasing downward pressure on the stock market, and rising US Treasury interest rates, and the overall performance is expected to be a "mirror image" in 2021.
Second, in 2022, it will enter the "second half" of capacity expansion, but it will encounter a "downward period" of corporate profits, and the "supply and demand gap" in profits in 2022 will transition to a potential "oversupply".
Third, the opening of the "double carbon stable credit" cycle in 2022 will repair the structural credit differentiation of 21 years. The dual-carbon credit pattern of "one plus one stability" will form a mirror image of structural tight credit in 2021.
Fourth, from the perspective of the profit environment and financial conditions in 2022, it will be slightly conducive to the style of the broader market. If we further synthesize the profit forecasts and dynamic valuations of various broad-based indices and market value ranges, we tend to judge that the market style in 2022 is difficult to form a one-sided trend, and the market value style is balanced.
Fifth, the industry performance in 2021 is the most significant feature of "the upstream is better than the middle and lower reaches". In 2022, based on the convergence of PPI-CPI scissors difference, the reversal of supply and demand gaps, and the credit cycle "one plus one stability", the industry configuration line of sight will be more shifted to the middle and lower reaches.
In terms of industry configuration, we recommend paying attention to white electricity and food processing that benefit from PPI-CPI transmission; rail transit, green buildings, green power operators, etc. of the "double carbon" wide credit main line; new energy materials and military industries with "supply and demand gap" or "supply and demand resonance"; and new energy vehicles, photovoltaic modules, semiconductor equipment, etc. that benefit from the differentiation of emerging track booms.
Yangtze River Bao Chengchao: Optimistic about the hidden champion of China's manufacturing industry
Looking forward to 2022, we remain positive about the A-share market, long-term optimism about the hidden champions in China's manufacturing industry, and long-term emphasis on the future growth of mass consumer goods under common prosperity.
Under a neutral scenario, we believe that domestic monetary policy will remain relatively independent, and the liquidity environment will be loose and less affected by overseas interference. We have gradually seen that the "new kinetic energy" (similar to new infrastructure, etc.) has begun to have some ability to hedge the drag of the "old kinetic energy" (real estate development investment) in terms of credit increment.
A wide currency and weak but not stalled credit will still keep the remaining liquidity environment in the financial markets comfortable, and we remain optimistic about the A-share market in 2022.
In terms of industry configuration and long-term dimension, we are still firmly optimistic about the hidden champion of China's manufacturing industry.
First of all, China has the world's most complete industrial system and manufacturing industry chain, with outstanding comprehensive cost and technical advantages. After the shuffle of the past decade, many manufacturing sub-sectors have gradually shown the characteristics of clear competition pattern and significant leading advantages. Such opportunities are widely present in the fields of capital goods and raw materials such as chemicals, metal materials, industrial machinery, and consumer manufacturing. In addition, looking at the medium term, we also notice that the demand for overseas capital expenditure is gradually rising, and combined with this demand judgment, the hidden champion in Chinese manufacturing will show a higher premium.
In addition, we are optimistic about the long-term growth opportunities of mass consumer goods in the context of common prosperity. Looking at the capital expenditure of important listed companies around the world in the past 40 years, it can be clearly seen that China's optional consumption in the 10 years after the financial crisis is a typical growth period, but the growth of mass consumption is lackluster. In the future, in the context of common prosperity, we will focus on the growth opportunities of mass consumer goods brought about by the increase in the marginal consumption tendency of low-income people.
Zhang Xia of China Merchants Securities: The overall A-share market may show a trend of "stability before and then rise", similar to "√"
Looking forward to 2022, the trend of transferring residents' funds to "wealth management with rights" is still there, but before the liquidity is significantly relaxed, the pace of incremental funds has slowed down compared with the previous two years. The market value of A shares has increased significantly, and the turnover rate of A shares will remain relatively low. On the other hand, the valuation of institutional heavy stocks is at an all-time high.
Therefore, the market of A shares will show a trend from hustle and bustle to flatness, and there are still local structural investment opportunities, but the amplitude may be difficult to be as magnificent as in the past three years.
In terms of rhythm, the macroeconomic situation in 2022 shows a stable situation before and after the low, exports are facing downward pressure under a high base, investment and financing needs to be further introduced by the stable growth policy, the growth rate of corporate earnings in the first half of the year to maintain a downward trend, triggering the counter-cyclical policy is more active, the growth rate of new social financing is expected to turn positive around the third quarter, bringing profit expectations upwards, when A shares will usher in the starting point of a new round of upward cycle.
Therefore, the overall A-share may show a trend of "rising before and after", similar to "√".
In terms of market style, although there are still many investment opportunities in emerging industries, small and medium-sized companies in emerging industries that specialize in new and upward trends still have the opportunity to obtain higher yields. However, on the whole, due to the downward trend of economic growth and corporate earnings growth, the overall environment is more conducive to large-cap stocks with relatively stable performance, and the large-cap style is expected to prevail. Values and growth styles may be more balanced, showing the characteristics of rotation.
In terms of industry allocation, the undervaluation repair around the "counter-cyclical" policy and the TMT that conforms to the trend of the new technology industry are the core layout ideas. On the one hand, under the triple pressure of economic growth, the stable growth policy is expected to be launched, which can be laid out in the direction of "liquidity improvement", "stable social financing", "new (energy infrastructure and digital) infrastructure", "stable real estate" and "consumption promotion".
On the other hand, a new round of information technology revolution represented by AIoT is being nurtured, and local trends such as autonomous driving and industrial Internet are accelerating; on the consumer side, with the influx of technology giants, the industrialization of "meta-universe + AR" is accelerating, and attention can be paid to the landing of AIOT applications (intelligent driving + industrial Internet) and "meta-universe + VR".
Huaxi Lifeng: The market will spread from first-line leading stocks to "second- and third-line" high-quality growth stocks
In 2022, A-shares will interpret the "high-quality development cattle", and the selection of high-quality tracks has become the top priority for investors.
China's economy has entered a new normal, and the economic development model has shifted to a "high-quality" development model. Therefore, in terms of operating characteristics, it will be difficult for A shares to rise in 2022, and congestion in some subdivided tracks will become the norm.
However, this does not constitute a sufficient reason to be bearish on growth and consumer stocks, and A-shares may also rely on "rapid rotation of sectors that subdivide high-quality tracks" to digest and break the deadlock of crowded tracks. And in 2022, the daily trading volume of A-shares is expected to continue to be above the trillion scale, and the rotation of the plate is still relatively fast.
In terms of investment strategy, the strategy of winning the "leader" by lying on A-share investment in 2022 is not dominant, and it is expected that the market will spread from first-line leading stocks to "second- and third-line" high-quality growth stocks. In terms of industry configuration, the probability of 2022 will be "structural" market, "growth, stability" is an important consideration factor in the industry configuration in 2022, it is recommended to pay attention to the main line of consumption and growth.
Standing at the current point in time, we give suggestions for the allocation of the A-share industry in 2022, specific to the "six" major high-quality tracks, which are: new energy; intelligent electric vehicles; semiconductors; military; high-end/sub-high-end liquor; innovative drugs, CXO, etc.
In addition, the plan of the year lies in the spring. Taking history as a lesson, under the influence of many factors such as abundant market liquidity and warm policy level, A shares in the first quarter often deduce the structural market of "sending red envelopes", and it is expected that A shares will also appear "spring restlessness" in 2022.
Minsheng Mou Yiling: 2022 is full of opportunities
Unlike some investors, who believe that we are standing at the end of a 3-year bull market, we believe that we are standing in a market that has undergone a short cycle of adjustment after a year: a decline in leverage levels, valuation compression, and a reshaping of the investor structure.
Looking forward to 2022, the key word of the core contradiction is the recovery of demand superimposed on supply constraints. Domestic demand will rebound significantly, but the cost and supply side face two major constraints: first, the environmental cost difference indicated by the Chinese and foreign carbon prices and the energy price difference per unit of heat will form an external constraint on the price of low energy and high-energy raw materials in China; second, the stability of the power supply will still become the weak link in 2022. Inflation resilience will likely be greater than economic resilience itself.
2022 is full of opportunities, we focus on the opportunity for the profit value of traditional cyclical enterprises to be re-recognized by the market (copper, crude oil, coal, aluminum); pay attention to the value repair of real estate and banks; electricity will be the most growing energy source, and investment opportunities in the construction of the power sector and power grid under structural shortage; rural revitalization under common prosperity will become the most important new growth clue after 2022, and the corresponding county consumption will have a new impact on the structural differentiation of consumer goods gross margin since 2016. This leads to new investment opportunities.
Ping An Weiwei: The overall volatility of the A-share market in 2022 is upward
We see the overall market environment in 2022 as a combination of economic rebalancing + marginal easing of liquidity.
In terms of economy, the marginal improvement of consumption and the resilience of China's exports will become important support items for the economy.
In terms of liquidity, in the context of stable growth + inflation easing, China's monetary policy has further room to open, and the first half of 2022 will be the window period for China's monetary policy easing.
Social finance is expected to slowly stabilize and rebound, and structurally it is expected to increase support for the real industry. On the one hand, it is to support the development of carbon-neutral industries, including the green upgrading of new and old industries, on the other hand, to promote the capital market to become a hub of scientific and technological innovation, and there is a large room for direct financing in the capital market in the future.
For the A-share market in 2022, we believe that the overall volatility of the market is upward, and the structural aspect grasps the three main lines of innovation, green and consumption.
Overall, it is expected that the overall fluctuations of A-shares in 2022 will be upward, and the rotation of the plate will be more frequent with the changes in industrial prosperity and valuation.
In 2022, there are three main lines of industrial transformation:
First, innovation drives the main line, high-end manufacturing includes chips, innovative drugs, medical devices, new materials, national defense and military industries, etc., and the digital economy includes the application of digital technologies such as 5G and data center construction, cloud computing/artificial intelligence/Internet of Things;
The second is the main line of carbon neutrality, the diffusion of investment opportunities in the upstream and downstream links of the industrial chain such as new energy vehicles, new energy, energy storage, energy conservation and environmental protection, and at the same time pay attention to preventing the risk of excessive valuation in stages;
Third, the main line of marginal improvement in consumption, the high valuation of food and beverage and beauty care sectors is expected to ease, and the profit expectations of outdoor activities are expected to turn positive, but the improvement in consumption and the rhythm may be affected by the epidemic.
Xingye Zhang Qiyao: 2022 has a money-making effect and structural opportunities
There is no systemic risk in 2022, and it will still be a market with a profitable effect, mainly structural opportunities, and a bottom-up selection of individual stocks.
Focus on 7 directions:
1, photovoltaic: driven by the dual carbon policy, the penetration rate will continue to increase.
2. Wind power: The follow-up of large base projects is expected to advance steadily.
3, new energy vehicles: domestic and foreign demand continues to increase.
4. Military-military aviation industry chain: the strategy is to see the compensatory development needs during the "14th Five-Year Plan" period.
5. Semiconductors: The global semiconductor equipment market continues to be booming.
6, 5G new infrastructure: the three major operators of the Internet of Things, big data and other innovative services increased. Under the background of the subsequent increase in downward pressure on the economy, the direction of new infrastructure is more dependent.
7. Innovative drug industry chain: With the adjustment of the early stage, the overall cost performance has been highlighted. In the long run, the growth rate of China's innovative drug market will be significantly greater than that of generic drugs, which is expected to bring about a substantial increase in pharmaceutical research and development expenditure, and the prosperity of innovative drugs and CXO plates will be supported for a long time.
CICC Li Quest: The index may usher in a phased opportunity in 2022
We believe that the opportunities in China's stock market in 2022 outweigh the risks.
We judge that weak demand and gradual easing of price pressure are the logic that needs to be paid attention to in asset allocation in 2022. In this context, in 2022, the profit growth rate of A-share companies may show a trend of "low before and high after". Whether the epidemic is gradually coming to an end and its impact on local growth and industry structure will also be a factor worthy of attention.
At the same time, the trend of institutionalization, productization, internationalization, fundamentalization and institutionalization of the A-share market is still deepening; the further development and improvement of major exchanges has brought fresh power to the stock market; residents have increased the allocation of financial assets to support the liquidity of financial markets, including the stock market, and the net worth of financial funds may also promote the allocation of medium- and high-risk assets in the financial fund part.
Structurally, China's own industrial trends and global technology cycles are superimposed, continuing to generate trend opportunities. The structural transformation of China's "new and old differentiation" is still continuing, and the trend of industrial upgrading is in the ascendant; consumption upgrading is moving forward; the trend of digital economy is spiraling; and the conversion of new and old energy under the trend of carbon neutrality is becoming more and more obvious, which is still a structural trend worthy of attention in 2022.
In terms of rhythm, with the increase in policy stabilization and growth, the index may usher in a phased opportunity. The configuration direction is based on "stable growth" in the short term, and the growth direction is mainly in the high-end manufacturing and consumption in the medium term.
Proofreader: Wang Qi
Photo editor: Zhao Yanyi
Producer: He Yongxin
Editor-in-charge: Zhang Xiaoguang
Producer: Pu Hongyi
Issued: Pan Linqing
Source of this article: Shanghai Securities News
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