A shares fell sharply, the reason was found! The latest interpretation of the fund

On October 19, all stock indexes fell across the board, with the three major indexes falling by more than 1%, the Shanghai Index falling 1.74% to nearly 3,000 points, and the Shanghai 50 Index falling by more than 2%.

After the market, ten fund companies including China Merchants, Bosera, CEIBS, Invesco Great Wall, Yongying, Chuangjin Hexin, Hang Seng Qianhai, Changsheng and Zhonghai interpreted it for the first time.

Public fundraising institutions generally believe that the backlog of travel and party demand after the long holiday may weaken significantly, with a weaker recovery in market sentiment due to the record high in U.S. Treasury yields, limited recovery in expected fourth-quarter data and poor property sales. However, combined with the Shanghai index approaching the 3,000-point mark, the characteristics of the market bottom appeared, as far as A-shares themselves are concerned, there is no need to be too pessimistic.

Market sentiment has recovered weakly

On October 19, the Shanghai Composite Index fell below the previous low of 3,053 points and closed at 3,005.39 points. The Shenzhen Component Index fell 1.65% and the ChiNext Index fell 1.28%. All three indexes hit new lows for the year.

The turnover of the two cities has been amplified, and northbound funds have flowed out sharply, with a net sale of nearly 12 billion yuan in the whole day. On the market, the insurance, oil, pharmaceutical, automobile, banking, brewing sectors fell first, agriculture, steel, power, coal and other sectors all fell, the brokerage sector rose against the market, semiconductors, chip concepts were active, and the concept of diet pills plunged sharply.

In this regard, the fund company believes that the US Treasury yield hit a new high, the expected fourth quarter data recovery is limited, and the real estate sales are not good, which has led to market worries.

According to the analysis of the equity investment department of Invesco Great Wall Fund, the main reasons for the recent sluggish market sentiment are as follows: First, the recent intensification of the Palestinian-Israeli situation, triggering expectations of stronger inflation, the US bond interest rate rushed 5%, overseas funds further outflow, today's northbound capital outflow of 11.7 billion yuan. Second, the market rumors that the performance growth of a certain weight white horse slowed down, causing greater disturbance to sentiment and driving the sector down.

Yong Win Fund said that the US retail sales data in September was better than expected, the overnight US bond interest rate broke 4.9%, a new high since 2008, and the widening of the Sino-US interest rate differential led to a large net outflow of more than 10 billion yuan from the north, suppressing major stock indexes. In addition, the release of domestic economic data for the third quarter of the week, the market's expectations for the increase in the fourth quarter of the stable growth policy have cooled, which also contributed to the decline of today's stock index to a certain extent.

From a macro perspective, China Overseas Fund also said that due to the recent strong employment and consumption data in the United States, the market's expectations for the Fed's future interest rate hikes are rising. At the same time, as the US government increased the supply of Treasury bonds and the Fed continued to shrink its balance sheet, the 10-year US Treasury yield broke through 4.9% yesterday, which also increased the pressure on the outflow of funds from the north.

Bosera Fund commented that under the influence of many factors such as the market's continued tightening of liquidity by the Federal Reserve, the expectation of overseas liquidity tightening, and the escalation of international geopolitical conflict risks, global risk assets have come under greater pressure.

In your opinion, it is not advisable to be too optimistic at the moment, after the Golden Week holiday, the backlog of travel and party demand may weaken significantly, the real estate industry has not yet ushered in a real recovery, coupled with the uncertainty of overseas markets, market sentiment has recovered weakly.

Xie Jun, investment manager of Hang Seng Qianhai, concluded that the reasons for the recent sluggish performance of A-shares are mainly as follows. First, the domestic economy is still hovering at the bottom, and the recovery is weak. The performance expectations of the liquor sector, which led the decline recently, are poor, and other large consumption weight sectors have also performed sluggishly, and the plunge in the weight sector amplifies pessimism.

Second, U.S. Treasury yields hit record highs that are bearish for global risk assets. U.S. Treasury yields have recently broken through new highs, with the 10-year Treasury approaching 5%, short-end interest rates rising even more fiercely, and the 2-year U.S. Treasury yield rose 14 basis points to 5.24%, the highest in 17 years since 2006. Behind the continuous rise in interest rates is the market's concern about the rise of the US inflation center in the medium and long term, and the expectation of interest rate hikes has revived.

Third, the global political environment is not good, and black swan incidents are frequent. For example, the recent outbreak of the Palestinian-Israeli conflict has led to a decrease in market risk appetite.

"The recent plunge can be seen as a continuation of the plunge since August, and the core reason is still the weak performance of the domestic economy, and pessimism has gradually spread over time and the catalyst of peripheral events." Xie Jun said.

The food and beverage (Shenwan) industry performed poorly, with the liquor sector of the sub-industry falling significantly. CSI Liquor Index (399997. SZ) fell 3.36% today, and the index selected no more than 50 stocks from the liquor-related listed companies as the index sample stocks based on the total market capitalization, reflecting the overall performance of the liquor theme. At present, the index contains 18 constituent stocks, including A-share liquor theme companies in Shanghai and Shenzhen.

In this regard, China Merchants Fund believes that the main reasons for the recent poor performance of the liquor index are the relatively flat sales of liquor in the double festival, the slight pressure of the wholesale price inventory index, and the volatility of the general market, specifically: First, although the Mid-Autumn Festival National Day liquor sales landed steadily, the stock price was supported by factors catalyzed by the peak season before the holiday, and after the feedback after the holiday, the overall was lower than expected, so the stock price fell to make up for the decline.

In addition, from the perspective of wholesale prices and inventory, the inventory of major wine enterprises increased slightly year-on-year, the wholesale price was basically stable, but the policy such as red envelopes increased, and the slight pressure of high-frequency channel indicators affected investors' confidence in the short-term operation of wine enterprises. Coupled with the overall volatility of the broader market after the National Festival, the low risk appetite of funds affects the performance of liquor stock prices.

Don't be too pessimistic at this point

Looking forward to the future market, public funds are still full of confidence. Combined with the Shanghai Index approaching the 3,000-point mark, the characteristics of the market bottom appeared, Chuangjin Hexin Fund optimistically said that as far as A-shares themselves are concerned, there is no need to be too pessimistic.

Changsheng Fund also believes that there is no need to be too pessimistic at the current point, after the adjustment, the market valuation has fallen back to a safer position, among which the TMT sector is still worth exploring investment opportunities in subdivisions under the resonance of multiple factors. Domestic manufacturing and export chains have areas of prosperity recovery, and the pulling effect on the domestic economy is increasing.

Domestically, China Overseas Fund said that the market's previously expected real estate support policy and the policy of activating the capital market have basically landed, and will enter the policy "verification period" in the future. Because it takes time for the policy to take effect, the short-term macro data has not improved significantly, and the medium and long-term economic recovery trend is still optimistic.

In the past two months, policies have been released one after another, covering the real estate market, enlivening the capital market and boosting the private economy, constantly releasing signals of stable growth and helping to boost market confidence. Bosera Fund analysis, from the economic data indicators, the signal of domestic economic stabilization is gradually increasing, positive factors are also increasing, and the overall trend of economic repair remains unchanged. However, since October, the northbound funds have generally continued the trend of net outflow, and the issuance of partial stock funds is still cold, and in the absence of incremental funds in the market, the A-share bottoming time may be longer than previously expected.

At present, the odds of position A and H are at a high level, based on this, Yong Win Fund remains optimistic about the subsequent market. On the one hand, the economy is showing signs of recovery. During the November holiday, per capita tourism consumption has recovered to the level of about 97.5% in the same period of 2019, which is further improved compared with the recovery degree of Dragon Boat Festival and May Day holidays. At the same time, the household savings rate fell sharply to 35% in the third quarter, which is lower than the same period in 2019, residents' willingness to consume is gradually repaired, the subsequent economic recovery is still expected to continue, and the bottom of listed companies' earnings can be expected to be revised upward.

In both respects, the fiscal policy dimension is still worth looking forward to. Since the beginning of the year, monetary and industrial policies have been relatively active, but fiscal policies have been relatively flat. As the personnel changes of the Ministry of Finance are coming to an end at the end of September, new changes are expected in follow-up fiscal policies, which will support the economy and market confidence; Third, it is difficult for the financial situation to deteriorate further. Since August, the market retracement has been mainly affected by the continuous outflow of northbound funds and the limited domestic incremental funds, although the above situation is still possible to continue in the short term, but it is difficult to further deteriorate at the margin, and the market pricing has been relatively sufficient.

In general, Yong Win Fund judged that the subsequent economic and capital deterioration is relatively limited, but the marginal improvement space is high, and there is still a possibility of increasing the weight in terms of superimposed fiscal policy, so the current position of A/H shares has high odds and remains optimistic about the future market.

Xie Jun, investment manager of Hang Seng Qianhai, believes that the current A-share policy bottom has come out, the market bottom is still being explored, and it will take a while for the policy bottom to the bottom of the market, but it should not be too long, the current domestic economy is already recovering, although the strength is weak, but the margin has been gradually reversed, mapped to the A-share market, it may take longer for the market to confirm. "In general, although it is still dark in the A share now, it is getting closer and closer to the dawn." He emphasized.

Wait patiently for short-term risks to be fully released

Therefore, from the consideration of capital safety, the fund company recommends that investors pay close attention to the stabilization of domestic economic data and marginal changes in overseas factors, and wait patiently for short-term risks to be fully released.

Invesco Great Wall Fund Equity Investment Department said that economic and financial data in September showed that the overall economy is in a moderate upward trend, but the strength is still not strong, and insufficient aggregate demand and low prices are still the main problems. Since August, a new round of loose real estate policies has been intensively introduced, a package of measures to activate the capital market has been introduced one after another, and a number of tax policies have been continued.

The Equity Investment Department of Invesco Great Wall Fund believes that on the one hand, there is still room for the current policies in key areas to continue to exert force, and the follow-up may be implemented at a gradual pace and degree; On the other hand, the promotion of policies and the repair of the economy itself also take time, and the current micro performance is not obvious, and we look forward to more positive feedback in the future.

On the whole, the "combination of fists" of previous policies highlights the attitude and determination of decision-makers, and it is expected that the domestic economic fundamentals are expected to stabilize under the background of destocking and the gradual development of various stimulus policies, coupled with the current low valuation level of the overall market, and the yield of stocks and bonds is conducive to the equity market. Follow-up recommendations focus on stabilizing domestic economic data and marginal changes in overseas factors.

CEIBS Fund said that today, dragged down by the collective adjustment of weighted sectors such as liquor and banks, the three major indexes fell collectively and hit a new low for the year. In the context that the index has not yet stopped falling and stabilized, the continuity of short-term themes remains to be further observed. Therefore, standing on the consideration of capital safety, patiently wait for the short-term risk to be fully released, and when there is a clear right-hand turning signal, then choose the opportunity to enter the market or have a higher winning rate.

Yong Win Fund said that the following factors need to pay attention to three major factors in the near future: changes in domestic real estate sales; the Fed's subsequent statements; The evolution of geopolitical conflicts.

The consumption and pro-cyclical main line are worth paying attention to

In terms of sector opportunities, Xie Jun suggested paying attention to the sentiment reversal of the pharmaceutical industry, especially the innovative drug sector, paying attention to the expected reversal of the pro-cyclical sector with strong economic sensitivity after economic stabilization, and continuing to explore long-term investment opportunities in the fields of technology and high-end manufacturing, including high-end manufacturing, artificial intelligence, and national defense industry.

Changsheng Fund judged that in the next stage, the application of AI deepened, the equipment and materials benefiting from the upgrading of manufacturing in domestic demand, and the high-value-added finished products benefiting from export improvement are all directions worthy of attention.

China Merchants Fund is optimistic about the trend of the liquor sector, although the liquor market is under pressure in the short term under the background of slow economic recovery, but it has always maintained confidence in the long-term business attributes and brand value of the liquor industry, and believes that the liquor industry is a good track worthy of long-term attention. On the one hand, the performance of liquor enterprises is closely related to the recovery of economic activities, and with the gradual recovery of economic activities, the profits of liquor enterprises will also recover.

On the other hand, the concentration of the industry has increased under short-term cyclical fluctuations. In the future, excellent liquor companies may show the ability to cross the cycle, and more structural investment opportunities are expected to appear in the liquor sector. In the long run, the current valuation of the liquor sector has a certain cost performance, and the liquor sector has a better allocation value under the trend of consumption upgrading and concentration improvement.

At the current point, Bosera Fund recommends a balanced allocation that can pay due attention to opportunities in industry sectors with recovery expectations, such as petroleum and petrochemicals, nonferrous metals, coal, etc. in the cyclical sector, and food and beverage in the consumer sector.

The semiconductor sector strengthened intraday. Some institutions in the industry believe that chip design, foundry, production equipment, chip supply, personnel and other links are restricted, in this context, it is expected that more domestic customers will choose domestic chips, and the iteration of domestic training and reasoning chips is expected to accelerate and usher in new development opportunities.

For memory chips that are also relatively strong intraday, CEIBS Fund said that recently, the consumer electronics storage track has recently released a number of optimistic signals, inventory reduction, orders are growing, the price of original chips has risen, and a series of reversal signs such as the rise of multiple changes in the memory chip sector are indicating that the inflection point of the entire storage industry may be approaching. In addition, after the various chips on the PC consumer side are cleared, with the recovery of the economy, the demand for the chip market will enter the growth track.

Therefore, the emergence of memory chips from the exhaustion of profits to the beginning of the market reversal, the emergence of its inflection point may also indicate that the semiconductor industry will accelerate recovery.

Source: China Fund News