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Gold plunged, A-share dividend stocks also plunged, and the Ministry of Finance was overweight

Gold plunged, A-share dividend stocks also plunged, and the Ministry of Finance was overweight

The current market environment of high interest rates, rising reflation expectations and intensifying geopolitical conflicts is very unfavorable for technology growth stocks, Nvidia plummeted 10% last Friday, coupled with the performance funds of Zhongji Innolight, today's A-share AI technology stocks opened sharply lower as scheduled. But what many people didn't expect was that AI bottomed out, semiconductors even turned red, and the worst thing to fall was the two major directions of various institutions pushing hot dividends and going to sea.

Let's take a look at today's blockbuster news:

Gold and crude oil dived

Although the conflict between Iran and Israel on Friday caused the Asia-Pacific stock market to plunge, it was later discovered that it was a farce, and Iran and Israel basically did not do any damage, but A-shares and Hong Kong stocks paid for it. On the same day, gold, crude oil and other commodity futures also rose and fell.

The U.S. House of Representatives voted to pass a foreign aid bill worth $95 billion on April 20 local time, including more than $60 billion in aid to Ukraine and more than $26 billion in aid to Israel. However, this does not mean that the United States supports Israel to fight back, according to the Financial Associated Press, the US State Department will also sanction an Israeli force.

As we have previously highlighted, the recent surge in commodities such as gold and crude oil has priced in expectations of interest rate cuts by the Federal Reserve, recovery of the global manufacturing industry, and intensification of geopolitical games in the Middle East. But in reality, the Fed's interest rate cut expectations have been delayed, the conflict between Iran and Israel is not as serious at the moment, and commodity prices have attracted a lot of trading money into the game in the two-day farce, making trading highly crowded.

The same is true for A-shares, dividend stocks and resource stocks have changed from the previous main line to a standout, sucking blood from the whole market, and technology stocks continue to kill. When one direction rises to the bloodsucking market, and cannot tolerate the rise of other directions, it means that the market has become extremely fragmented, and imbalance represents instability, and it also means that a large number of active funds have poured into the transaction, and the chip structure has become crowded and fragile, and it is not far from a pullback.

As of press time, Brent crude oil futures fell nearly 1.5%, COMEX gold fell nearly 1.6%, and Shanghai gold closed down 1.63%. Judging from the trend of A-share related sectors, the non-ferrous metal sector has stepped out of several large upper shadow lines, indicating that many funds are taking the opportunity to cash out.

Gold plunged, A-share dividend stocks also plunged, and the Ministry of Finance was overweight

We are not sure how long gold and crude oil can go, and whether there is a large-cycle logic blown by some institutions. However, we do not see any basis for a strong recovery in the global economy at the moment. Although the U.S. economy is resilient, this is based on the sharp decline in the yield of U.S. 10 bonds in the fourth quarter of last year, which stimulated the economy by the downward trend in market interest rates and the support of spending by the wealth effect brought about by the sharp rise in U.S. stocks, and now the yield of U.S. 10 bonds has risen above 4.6% again, and U.S. stocks have also begun to fall sharply. Needless to say, the European economy is in a technical recession, and although the ECB is likely to cut interest rates in June, how much can the ECB cut if the Fed drags its feet on not cutting interest rates?

The global manufacturing PMI in March exceeded expectations and was an important factor in stimulating this round of bulk strength, but this may only be a replenishment of inventories.

The semiconductor sector exploded and turned red

In addition to the unfavorable market environment of high interest rates, high inflation and geopolitical games, the collapse of the global semiconductor sector last Friday is also related to SMCI's failure to disclose its results in advance as usual, and the financial guidance of ASML and TSMC, but in fact, the latter is not bad for A-share semiconductors.

ASML's Q1 revenue from China accounted for 49%, indicating that domestic wafer factories are actively expanding production, while TSMC's guidance is less than expected and related to Apple. In addition, among the stocks that disclosed the first-quarter performance forecast, the growth of the electronics industry was significantly ahead, while the semiconductor sector fell nearly 20% this year. The market either feels that the growth of technology stocks is unsustainable, or that the growth of technology stocks is fake money, and 100% growth is not as good as the 4% dividend of dividend stocks.

Gold plunged, A-share dividend stocks also plunged, and the Ministry of Finance was overweight

The Ministry of Finance is heavy

The State Council Information Office held a press conference on the fiscal revenue and expenditure in the first quarter of 2024. Li Xianzhong, director of the Treasury Department of the Ministry of Finance, said at a press conference of the State Council Information Office on the 22nd that he would pay close attention to the changes in the supply and demand relationship and sales of savings treasury bonds, and study the appropriate increase in the scale of issuance.

Gold plunged, A-share dividend stocks also plunged, and the Ministry of Finance was overweight

Finally, look at the disk, as of the close, the Shanghai Composite Index fell 0.67%, the ChiNext Index fell 0.32%, the Hong Kong Hang Seng Index rose 1.77%, and the Hang Seng Technology Index rose 1.78%.

However, today's turnover shrank to 0.82 trillion, and it stands to reason that such a fierce rebalancing and stock swap should be increased, which may be related to the pre-holiday effect. In addition, this week is another super blockbuster week, the United States will release the first quarter GDP data and the core PCE and personal spending monthly rate for March, if the March core PCE is in line with expectations, it can give the market a little breather.

Gold plunged, A-share dividend stocks also plunged, and the Ministry of Finance was overweight

Risk Warning:

The stock market is risky, investment needs to be cautious, this article does not constitute investment advice, readers need to think independently

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