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.
First, the market temperature
Source: Wind, Haomai Institute. Time period: January 2, 2018 - May 10, 2024
With the recent rapid rise in the market, the market temperature has risen to 33.06°C, which has entered the neutral range, that is, the stock is no longer very cheap.
For high positions, watch more and move less. If the position is low, from the perspective of long-term investment, the current position is still worth operating, and you can add the position when it falls. In addition, this wave of rally is structural, and most industries are still cheap and worth layout.
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] and the market is at the bottom range, we should be more greedy and 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, and it can still be appropriately greedy; When the temperature value is at [30 °C, 70 °C], the market is neutral, and you can see more and move less; When the temperature value is at [70°C, 90°C] and the market position is high, you should consider gradually reducing your position in equity assets in batches and increasing the proportion of debt assets according to your risk appetite; When the temperature value is at [90°C, 100°C] and the market reaches a relative peak, you should be extremely frightened and consider significantly reducing your equity position, or switching the style of your holding funds, so as to avoid the risk of large drawdowns and large fluctuations that will occur with a high probability 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 range: 2014.1.2-2024.5.10
Second, the temperature of the industry
1. Top 3 weekly gainers and losers
Data source: Ifind, 2024.05.06—2024.05.10
Industry comments: this week's agriculture, forestry, animal husbandry and fishery, national defense and military industry, building materials rose in the lead, agriculture, forestry, animal husbandry and fishery benefited from the CPI temperature rise is expected to rise sharply this week, the national defense and military industry benefited from the tension of shipping and the concept of informatization rose sharply this week, and building materials benefited from the low level of the expected economic recovery.
Computers, communications, and media were affected by the high stagnation of overseas technology stocks and the ST cap, and their performance lagged behind this week.
2. Industry thermometer
Source: Wind, as of 2024.05.06-2024.05.10
Baijiu: The liquor thermometer is 25.18 degrees, and the temperature rises slightly. Although the liquor sector has benefited from the sharp rise in foreign capital inflows, the destocking of high-end liquor is still on the way to recovery in the short term, and the real estate cycle still needs to pick up, so it is possible to wait patiently for the release of the first quarterly report before considering allocation.
Medicine: The medical thermometer is 31.52 degrees, and the temperature rises. Recently, there has been a "market catalyst" for immune cell therapy in the pharmaceutical sector, and at the same time, the innovative drug sector of Hong Kong stocks has repaired the early decline and stood at the support level.
New energy: The new energy thermometer is 40.15, and the temperature rises. Recently, the new energy-related lithium battery sector has ushered in the supply-side clearance measures of ineffective capacity restrictions, which means that the upside of lithium batteries is opening, and the strategy can wait for the callback to consider the layout.
Technology: The technology thermometer is 32.68, and the temperature drops. In the short term, the technology sector should pay attention to the risk of small-cap stocks, and the concepts related to semiconductors, CPO, and cloud computing in the medium and long-term technology sector are still worth paying attention to.
Banks: Bank thermometer 62.15, a slight increase in temperature. Considering the further optimization of the real estate policy, it is expected that the valuation of banks may continue to be repaired in the future.
3. Valuation of important indices
Source: wind; Data cut-off date: May 10, 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 out the Haomai Index Valuation Tool.
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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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