In the five trading days of this week, the A-share market showed a significant upward and downward trend after reaching a new low in the detection stage. Specifically, this Monday's market still continued the trend of last Friday and maintained a weak balance, but on Tuesday it chose to change downward, and while making up for the previous gap of 2865, it also hit a new low. Under normal circumstances, Wednesday should continue to fall by inertia. However, there was a strong counterattack under the many positive resonances on the news side, the trading volume was enlarged to 900 billion, and the market rose sharply to break through the 5-day line and the 10-day line in a row, until it was blocked near the 20-day line.
Wednesday's rise is larger, and it is a bald and barefoot long white candle, so there will be inertia on Thursday, and the probability of retracement on Friday will be greater. However, what the vast majority of investors did not expect was that the market on Thursday was only a small inertia and began to weaken not long after. On Friday, there was a significant retracement due to the sharp shock in the peripheral market overnight.
It is not difficult for careful investors to find that this week's A-share market has been violently fluctuating against the technical trend for three consecutive days since Wednesday, and the root cause of the abnormal volatility of the market is that a series of major events have occurred on the news side, such as the central bank's super week, Politburo meeting and so on.
So, how will the market go next week? Can we quickly stop the decline at the current position? To figure out this problem, we must do a detailed combing of the market news over the weekend to see if there are any heavyweight positives or negatives that will have a lasting impact on the market trend next week?
First, the United States non-farm data fell sharply short of expectations, Intel plummeted 26%, and the yuan soared!
This weekend, the situation on the side of Lao Mei is not optimistic, and there have been a number of heavyweight negative impacts in a row, most of which will affect the trend of A-shares at the beginning of next week!
First, the Bureau of Statistics of the United States Department of Labor released the July non-farm payrolls data. Data showed that United States employment slowed more than expected in July, with the unemployment rate rising to its highest level in nearly three years, suggesting that the labor market is deteriorating faster than previously expected and that recession indicators have been triggered. Since the non-farm payrolls data was too poor, the market bet that the Fed will cut interest rates by 50 basis points in September.
According to Jingyang's understanding, in the past few months, the Federal Reserve has not planned to cut interest rates because domestic inflation has not dropped significantly. Whether or not to cut interest rates in September is a question. Just one or two months later, not only is the September rate cut a certainty, but the probability of a one-time rate cut of 50 basis points has greatly increased. According to Citigroup and Xiaomo's expectations, the Fed will cut interest rates by 50 basis points each in September and November, and will cut rates by 25 basis points each time from the December meeting. According to them, this means that the bank will need to cut interest rates by 125 basis points this year.
In addition, several tech giants in United States have not stopped the bearish news this weekend, and the first one is Intel!
On the news side, Intel's latest financial report suffered a series of negatives: second-quarter results and third-quarter guidance were less than expected, large layoffs, and suspension of dividends. Among them, the most worrying thing for the market is that Intel's performance guidance is significantly lower than expected, and the uncertainty of future growth has increased. After the release of this thunderous results, a number of Wall Street institutions collectively downgraded Intel's rating. In addition, S&P placed Intel's rating on negative credit watch.
Under the blow of the bearish combination punch, Intel plummeted 26% on Friday! The biggest intraday drop was more than 30% at one point, the biggest drop since 1982!
The impact of these two events on U.S. stocks is self-evident. If the non-farm payrolls data is only slightly weaker than expected, then the US stock market is more concerned about the impact of the Fed's interest rate cut, and the US stock market will not be too bad on the contrary; However, the non-farm payrolls data is significantly weaker than expected, and the market will stage a capital battle royale because of the fear that the United States economy will be shaken!
Intel's performance is less than expected, and at present, it is only Intel's own problem, because the performance of Nvidia, which is more concerned by the market, has not wavered. But Intel's weight is there, plummeting 26% in a single day, and the drag on U.S. stocks is also obvious!
In the end, the three major U.S. stock indexes fell collectively on Friday night, with the Dow falling by 1.5% and the Nasdaq falling by 2.43%. Looking at the technical patterns of the Nasdaq and Dow alone, there are already signs of loosening in the medium-term uptrend. However, we can't look at U.S. stocks with the usual technical analysis of A-shares, which have been in a bull market pattern for a long time, and rarely have a medium-term trend decline. Maybe after digging a hole, it will quickly stop falling and stabilize next week.
These two events, as well as the sharp drop in U.S. stocks, will definitely have an impact on the A-share market next week, but it is difficult to say if it is not negative!
This is because the US dollar has depreciated sharply after the Fed's interest rate cut expectations have increased, and the RMB exchange rate has also risen with a vengeance on Friday! Among them, the appreciation of the offshore exchange rate is almost the same as the depreciation of the US dollar, both exceeding 1.1%. This range may not be a big deal for the stock market, but for the exchange rate, it is definitely a sharp fluctuation. From the point of view, the appreciation of the offshore yuan reached 800 basis points on Friday night, from 7.25 directly to around 7.16.
In many previous articles, Jing Yang has talked to everyone. Whether northbound funds flow into A-shares is mainly determined by three factors: first, the size of the exchange rate difference between China and the United States, the stronger the willingness of foreign capital to flow under the trend of RMB appreciation and US dollar depreciation; Second, when the domestic economic fundamentals show signs of improvement, or the policy side increases efforts to stabilize the economy, the willingness of foreign capital inflow will be strengthened; Third, the point of A-shares, which is of course more attractive when it falls.
Judging from the current situation, these three points have undoubtedly been satisfied, so this Wednesday, northbound funds will increase their positions by 19.5 billion in a single day! Although there was a small outflow on Thursday and Friday, stimulated by the sharp rise in the RMB exchange rate on Friday, the probability of northbound funds turning around and increasing their positions again next week is still very high!
It is not difficult to see that the impact of the violent fluctuations in the external market on the weekend on A-shares is relatively complicated. U.S. stocks and Intel fell sharply, which may cause the A-share market and technology stocks to open lower on Monday. However, considering that A-shares have retraced in advance on Friday, and technology stocks have generally fallen a lot. Therefore, after opening low on Monday, it may not necessarily go low, and there is the possibility of opening low and going high.
Second, the State Council issued the "Opinions on Promoting the High-quality Development of Service Consumption"!
The State Council recently issued the "Opinions on Promoting the High-quality Development of Service Consumption", which is one of the main benefits of domestic policy over the weekend!
Jingyang noted that the "Opinions" put forward 20 key tasks in 6 aspects. The first is to tap the potential of basic consumption such as catering and accommodation, housekeeping services, and elderly care. The second is to stimulate the vitality of improved consumption in culture and entertainment, tourism, sports, education and training, and residential services. The third is to cultivate and expand new types of consumption such as digital, green and health. Fourth, we will enhance the momentum of service consumption, innovate service consumption scenarios, strengthen the cultivation of service consumption brands, relax market access for the service industry, and continue to deepen the opening up of telecommunications and other fields. Fifth, optimize the service consumption environment, strengthen the supervision of service consumption, guide honest and compliant operations, and improve service consumption standards. Sixth, strengthen policy guarantees, strengthen fiscal, tax and financial support, consolidate the support of talent teams, and improve the level of statistical monitoring.
Relevant departments and localities have jointly carried out a series of consumption promotion activities to improve the quality of service consumption and benefit the people during the service consumption season, and continue to create service consumption hotspots and promote the improvement of service quality.
Jingyang has emphasized to you many times that although the GDP report card in the first half of the year has just passed, the GDP in the second quarter alone is actually only 4.7%, and the downward trend is very obvious compared with the first quarter. Therefore, if we want to stabilize the 5% annual growth target set at the beginning of the year, then from now on, there will definitely be a combination of stabilizing the economy.
It is in this context that the Third Plenary Session and the Politburo meeting were held recently, so Jingyang believes that the recent domestic economic stability will be quite intensive, from the State Council, to the central ministries and commissions, and local governments, we can see all kinds of economic stimulation measures every day.
It was the State Council that took the lead this weekend, and Jingyang doesn't remember that this is the first document on stabilizing the economy issued by the State Council in the last week or two. The focus of this opinion is on consumption and service industries, mentioning catering, housekeeping, elderly care, entertainment, tourism, sports, education and other issues closely related to people's livelihood. From the perspective of the mainland's economic structure, consumption accounts for 60% of GDP, while investment, imports and exports account for only 40% combined. Therefore, increasing financial investment in infrastructure construction and water conservancy can only play a role in throwing bricks and attracting jade. The real big deal is whether the people are willing to spend money and spend!
Jingyang believes that the State Council's issuance of the "Opinions on Promoting the High-quality Development of Service Consumption" is neither the first nor the last stick of this round of economic stabilization policies.
Third, the controlling shareholder of *ST Yaxing proposes to terminate the listing, and the first A-share company to voluntarily delist this year may be released!
On Friday night, *ST Yaxing disclosed that the company recently received a letter from its controlling shareholder, Weichai (Yangzhou) Investment Co., Ltd. (hereinafter referred to as "Weichai Investment"). Weichai Investment said that based on the current market environment and the company's situation, it proposed that the company voluntarily withdraw the company's shares from the listing and trading on the Shanghai Stock Exchange by resolution of the general meeting of shareholders.
*This announcement by ST Yaxing (Yaxing Bus) may bring the first voluntary delisting company to the A-share market this year. This may seem like just a delisting strategy for one company, but it may provide new ideas for other junk stocks to delist!
Let's talk about the problem of *ST Yaxing first, the main superficial reason for the delisting is the annual loss of performance. Judging from the company's financial report, from 2020 to 2023, the company's net profit will be -158 million yuan, 1.8916 million yuan, -196 million yuan and -337 million yuan respectively. The losses are getting bigger and bigger. According to the company's own statement, the bus industry is affected by the total number of residents' travel, travel structure and the linkage of national and local policies, with the continuous development of high-speed rail, family cars, shared travel and other diversified modes of transportation, more and more alternative elements of buses, the bus industry continues to be in a weak cycle state.
But in Jingyang's view, this argument is obviously untenable. This can only be known by looking at Yutong Bus in the same industry that Yutong's annual net profit will maintain a stable growth trend from 2020 to 2023. Especially in 2023, net profit will soar from 700 million to 1.8 billion compared to 2022. On the other hand, *ST Yaxing will lose more than 300 million yuan in 2023, a new low since its listing.
And the fundamental problem of *ST Yaxing may still appear in management and operation. For this voluntary delisting, the market generally believes that it has a greater relationship with peer competition. *ST Yaxing has certain business overlap with other companies under the controlling shareholder and actual controller, such as Zhongtong Bus, another listed company under the actual controller Shandong Heavy Industry Group.
Previously, *ST Yaxing had stated that in order to solve the overlap of some businesses, Shandong Heavy Industry Group Co., Ltd., the actual controller of the company, and Weichai Investment Co., Ltd., the controlling shareholder of the company, issued a "Letter of Commitment on Avoiding Intra-industry Competition", promising to solve the overlap of some businesses within 5 years. It is clear that until now, the issue of competition in the industry has not been dealt with well.
Comparing the financial report of Zhongtong Bus, it can be found that while *ST Yaxing has suffered a large loss, although the net profit of Zhongtong Bus has not increased much in recent years, it will not suffer a large loss. In the first quarter of this year, net profit even doubled, and the signs of warping became more and more obvious.
From this point of view, we have reason to believe that the continuous loss of net profit of *ST Yaxing and the choice to voluntarily delist are not the problem of the entire industry, but the attitude and choice of major shareholders.
Since major shareholders choose to voluntarily delist, what impact will it have on the delisting environment of the A-share market? First of all, voluntary delisting can avoid many unnecessary troubles, such as financial problems, you can voluntarily delist before exposure, if you really wait until the problem surfaces, then the company's management is likely to encounter more trouble. This may further affect the image of major shareholders and controlling shareholders. Secondly, voluntary delisting can lock in the stock price, so that the stock price will not appear continuous falling limit, and the loss of investors will be much smaller. Take *ST Yaxing as an example, trading was suspended directly after Friday's announcement, and the stock price was not like other companies to be delisted for a period of time, and there were dozens of falling limits, and the stock price was hit below 1 yuan. At present, the stock price of *ST Yaxing is still 5.84 yuan. It is precisely because the stock price has not fallen sharply that it is also a kind of protection for small and medium-sized investors.
Of course, voluntary delisting requires the major shareholders of listed companies to have a certain strength, because when delisting, they need to come up with enough cash to return to investors.
From this point of view, *ST Yaxing's voluntary delisting provides a good idea for companies under central state-owned enterprises to leave the capital market. If you don't have the heart to continue operating, and you are afraid that the market value management will not be effective and drag down the political performance, I am afraid that the number of listed companies under the central state-owned enterprises will take the initiative to delist in the future. But it is difficult to say about private enterprises.
Judging from the weekend news, it can be described as a mixed bag, and it is all big news, which will definitely have a greater impact on the trend of A-shares on Monday. However, as analyzed above, the impact of the news is more complex, and we will not see the bearish side as a unilateral setback. Jing Yang believes that the probability of the A-share market opening low due to external shocks on Monday is still very high. If it continues to open lower, the broader market will open below the 5-day line, and the key support below the 5-day line is near 2890, which is the small platform level of the previous week. As long as this position can be stabilized and the 5-day line can be re-established in the next few days, then the market trend will not weaken again.