By tracking the performance of some indicators and indices, Haomai Thermometer aims to determine the current market position as much as possible, grasp the rhythm of market style switching, and capture opportunities in industry layout, so as to help investors make good investments. We also keep track of the valuations of some of the indices that investors are looking at.
Updated: Every Saturday at 10:00
First, the market temperature
Source: Wind, Haomai Institute. Time range: 2018.1.2 to 2024.4.19
This week, the market is seriously differentiated, driven by banks and other cycles, high dividends, and medium-sized stocks, the market index has rebounded, and the market temperature has risen to 20.01 °C, which is still in the greedy range, and most industries are actually down this week. This wave of pullback is within our expectations, but we believe that the pullback will not be too large, and now the market has adjusted a part, and those who have not reduced their positions before are now buying low and selling high The space is smaller, and the winning rate is lower, so it is recommended not to sell easily. And, from a long-term investment perspective, we should maintain a high stock position at the moment, and now we can consider adding to our position when it falls.
Tips：
How to prepare and use the market thermometer:
(1) Using index valuation, stock and bond spreads, the proportion of financing purchases, the deviation of the moving average, and other indicators that can reflect the market temperature, observe the level or absolute value of these indicators in history, and assign corresponding weights to them, and calculate the temperature value by weighting.
(2) The initial theoretical range of the market temperature value is 0°C-100°C, and when more bottom indicators are confirmed to the bottom, the lower temperature limit is adjusted to -10°C, that is, when the market is below zero, it is a better investment time.
(3) When the temperature value is at [-10 °C, 10 °C], the market is in the bottom range, should be more greedy, dare to lay out equity assets at a low level; when the temperature value is at [10 °C, 30 °C], the market position is still low, you can still be appropriately greedy; when the temperature value is at [30 °C, 70 °C], the market is neutral, you can see more and move less; when the temperature value is at [70 °C, 90 °C], the market position is higher, you should consider gradually reducing the position of equity assets in batches according to your own risk appetite. Increase the proportion of bond assets: When the temperature value is at [90°C, 100°C] and the market reaches a relative peak, we should be extremely afraid and consider significantly reducing our equity positions, or switching the style of the holding funds, so as to avoid the risk of large drawdowns and large fluctuations that will occur in the future.
(4) Through backtesting historical data, the Haomai thermometer can better reflect the temperature of the stock market. Note that the Haomai thermometer only reminds of the larger bottoms and tops, and does not judge the rise and fall of a short period.
Source: Wind, Haomai Institute. Time period: 2014.1.2 to 2024.4.19
Second, the temperature of the industry
1. Top 3 weekly gainers and losers
Data source: Ifind, 2024.04.15—2024.04.19
Industry Comments: This week, household appliances, banks, and coal led the gains, all three of which were high-dividend sectors to obtain capital allocation, while household appliances benefited from a substantial increase in exports.
The comprehensive sector, social services, and trade and retail were affected by the weakening of small-cap stocks, and the sentiment ebbed this week, while May Day was approaching, and some short-term funds needed to take profits, so the performance was lagging behind.
2. Industry thermometer
Source: Wind, as of 2024.04.15-2024.04.19
Baijiu: The liquor thermometer is 20.04 degrees, and the temperature drops slightly. This week, the liquor sector continued to be affected by the event, the decline in consumption expectations, and the long-term logic was slightly damaged.
Pharmaceutical: The pharmaceutical thermometer is 23.56 degrees, and the temperature drops. Considering that the earnings season is coming to an end, the performance of some innovative drug companies may exceed expectations, and it is recommended to pay attention to the innovative drugs and traditional Chinese medicine sectors on dips.
New energy: The new energy thermometer is 36.51, and the temperature drops. Recently, the performance of lithium battery leaders of new energy vehicles has picked up, the penetration rate of new energy vehicles has reached 50%, and the export data is more optimistic.
Technology: The technology thermometer is 24.93, and the temperature drops dramatically. The recent earnings season is approaching, and the performance of semiconductors has completely reversed, but the concentrated explosion of the computing power sector has caused the technology sector to suffer a negative impact, and strategically we can focus on independent and controllable sectors such as semiconductor chips and CPO with performance.
Banks: Bank thermometer 61.15, temperature dropped significantly. Due to the recent increase in long-term funds by banks, the leading banks are temporarily out of the systemic risk of the real estate downturn, and it is expected that the valuation may continue to be repaired in the future.
3. Valuation of important indices
Source: wind, data cut-off: April 19, 2024
Tips：
1. The column of PE/PB valuation quantile in the past 5 years: green light, valuation percentile <20%, representing undervaluation, yellow light, valuation percentile 20%~80%, representing medium valuation, red light, valuation percentile >80%, representing overvaluation (if the index is less than 5 years, according to the data statistics since the base day, that is, the three indexes of wind, light and storage, science and technology 50, science and technology leaders, 5G communication and Hang Seng technology index).
2. PE indicators are only applicable to industries with good liquidity and stable profits, such as securities, aviation, energy and other cyclical industries should look at PB. In addition, some industries with unstable earnings, or industries or broad-based indices with stable earnings in the short term, can also use PB to assist valuation. If you don't know how to judge, you can check the Haomai Index Valuation Tool, [Index Valuation Inquiry Path: Haomai Institute - Investment Tools - Index Valuation].
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Disclaimer: The content of this article is based on public information research and does not constitute investment advice. Investors should make prudent decisions and bear risks independently.
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