Since the beginning of 2023, the A-share market has continued to adjust, and today there has been a collective decline of more than 4,700 stocks, and the market has shown a general decline pattern. In the case of the post-holiday rebound expectations disappointed, the performance of individual stocks is particularly prominent. The reasons are, first, that this round of adjustment has not ended, second, the impact of selling chips, third, the lack of incremental funds, fourth, the main funds continue to cash out, and fifth, the lack of market confidence.
Specifically, first of all, this round of adjustment has not yet bottomed out, it is a trend decline, and the performance of individual stocks is the most direct. Even if the index rebounds slightly, based on the trend judgment, the rebound is limited, and it is difficult to drive individual stocks to stop falling and rebound. Secondly, there are a large number of selling pressure chips, and after each index rebound, large orders are sold to suppress the index, resulting in the pressure on individual stocks.
Again, the lack of incremental funding is a key factor. Capital promotion is the basis for the rise of the stock market, but at present, the trading volume of the two cities can continue to shrink, and the lack of funds is difficult to drive individual stocks to stop falling and rebound. In addition, major funds are also continuing to reduce their holdings and cash out, further suppressing market sentiment and exacerbating the decline of individual stocks. Finally, due to multiple factors, the lack of market confidence has also become an incentive for individual stocks to collectively decline.
In the case of the post-holiday rebound expectations, under the superposition of the above factors, the market's pessimism about the short-term trend has risen, and the pressure on individual stocks has fallen particularly obviously. However, in the medium and long term, the economic fundamentals are good, and the market still has allocation value. This round of adjustment will also lay an opportunity for the market to improve its quality. It is recommended that investors remain rational, avoid blindly following the trend, and grasp the opportunity at the bottom.
Specifically, although the current A-share market adjustment continues, it will not "collapse". So far, the two markets have fallen by nearly 20%, and some high-quality stocks are undervalued. From the perspective of liquidity, the central bank has previously carried out targeted RRR cuts, narrowed the difference in the pace of RRR cuts, and subsequently increased liquidity through open market operations to support the market.
From a fundamental point of view, the domestic economy has stabilized and improved, and the gradual implementation of policies has taken effect. Policies to stabilize growth will continue to be promoted, and relevant reform measures will also be implemented. With the optimization of the policy mix, the economic fundamentals will improve significantly, bringing structural allocation opportunities to the market. In addition, the easing of the external environment and the stabilization of Sino-US relations are also positive factors.
In general, it is recommended that investors adhere to the concept of value investment and pay attention to the allocation opportunities brought about by valuation repair. At the same time, it is also necessary to control risks, keep the bottom line, and avoid blindly chasing up and down when the trend is uncertain. Only by being steady and diligent can we better grasp market opportunities. It is believed that after this round of adjustment, the market will usher in a new round of upward cycle.