[Today’s Review] The GEM Index Rose Nearly 1%, With Liquor And Technology-themed Funds Leading The Gains; A-shares Bottomed Out And Rebounded

The three major A-share indexes collectively closed slightly higher today, with the Shanghai Stock Exchange Index rising 0.31% to close at 3,497.28 points; the Shenzhen Component Index rising 0.62%, closing at 14,506.61 points; the ChiNext Index rising 0.85%, closing at 3,139.69 points. The total transaction volume between the two cities was 842.2 billion yuan. Most industry sectors closed higher, with the beer sector rising sharply. Northbound funds bought a net 1.886 billion yuan today.

The fund market rose more than it fell. Judging from the valuation situation, the valuations of theme funds such as liquor, technology, military industry, and securities companies have increased the most; the valuations of theme funds such as steel, nonferrous metals, new energy, and medicine have fallen the most.

Analysts pointed out that the Shanghai and Shenzhen stock markets opened higher for a time today, but then continued to plummet. Since then, driven by the securities sector, the index bottomed out and rebounded, triggering a rise in multiple sectors, and eventually the index successfully turned red. After experiencing continuous declines, the current performance of the securities sector is strongly supported, and the valuation is relatively reasonable. After a phased rebound, the current mid-term bottom is also expected to be gradually discovered. Once market sentiment recovers and incremental funds enter, it is likely to become an important goal to continue to promote the strength of the index.

market review

Closing report: The three major A-share indexes closed up: the GEM index rose nearly 1%, and the beer sector rose sharply

Capital flow: Capital inflows occurred in securities companies, trusts, brewing industry, software services and other industries; capital outflows occurred in pharmaceutical manufacturing, automobile industry, non-ferrous metals and other industries.

Fund valuation: Liquor and technology-themed funds rose strongly, while steel-themed funds generally fell.

The liquor sector led the gains strongly, and the valuation of related theme funds topped the list

Cinda Securities pointed out that the trend of consumption upgrading is obvious, and brand + quality are the core of development. The overall industry recovery situation is improving after the epidemic, and the high-end wine market pattern is relatively stable. As a benchmark for industry prosperity, it continues to provide space for consumption upgrades in the sub-high-end price band; 600-800 yuan is an important price band for the structural upgrade of sub-high-end famous wines. At present, there are relatively few single products that can form a large scale; competition between 300-600 yuan has become more intense under the impact of the sauce and wine category, and it is also the price range with the fastest expansion of consumption upgrades. Brand and quality are the keys for wine companies to break through. Although the current valuation of the liquor industry is relatively high, as industry concentration increases, differentiation trends accelerate, and the stability of leading companies increases, high-quality assets will remain the first choice of investors.

Domestic software sector performs actively, and related theme fund valuations rise

Minsheng Securities said that it is waiting for the explosion of 5G applications and recommends laying out the main market. Liquidity is reasonable and abundant, risk appetite is expected to rebound strongly, and the industry has stabilized and rebounded. Key industry targets with higher prosperity and previously lower valuations have begun to rebound. Looking forward to the spring market, the computer industry will be affected by the epidemic in 2020. Negative factors such as budget cuts and slower-than-expected construction progress will lead to mediocre overall performance. Under the logic of low base, the market conditions are expected to be volatile. 1) Be optimistic about the explosion of 5G applications in 2021 and look for 5G core applications: including smart driving, ultra-high-definition video, industrial software, etc.; 2) Recommend layout in the main line market and focus on high-quality "track" core assets: cloud computing, network security, financial IT .

There has been a general correction in the steel sector, and the valuations of related theme funds have declined.

Guotai Junan pointed out that recently, the Standing Committee of the State Council has promoted commodities for two consecutive weeks and directly named the black series, causing the price of black series bulk futures to plummet across the board. The Standing Committee of the National People's Congress focused on combating speculation, saying it would implement supply and demand controls and maintain monetary policy stability. In an environment of shrinking domestic supply and supportive demand, prices of black series goods have risen rapidly, mainly affected by sentiment and trading factors. Sentiment is still in the correction phase.

institutional perspective

Jufeng Consulting: The Black Series is off the shelves again! Who will lead the index to another breakthrough?

In the market, brokerages once "turned the tide" and the index was protected to a certain extent. After experiencing continuous declines, the current performance of the securities sector is strongly supported, and the valuation is relatively reasonable. After a phased rebound, the current medium-term bottom is expected to gradually reach the bottom. Facts have proved that once market sentiment recovers and incremental funds enter, it is likely to become an important target that will continue to drive the index to strength.

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GF Strategy Dai Kang: Small-cap growth performance or ultra-small cap value

Whether the rise in global inflation expectations can be sustained is the core conflict in the subsequent rotation of major asset classes. Since the beginning of this year, the total volume of A shares has exceeded expectations due to corporate profits (driven by PPI) and inter-bank liquidity, and the structure has exceeded expectations due to microstructural adjustments and the gap between supply and demand. Corresponding to the performance of the A-share market, small-cap value stocks > small-cap growth > large-cap growth > large-cap value, and upstream and midstream materials outperformed the market. Valuations for small-cap growth stocks are at historically low levels. If inflation expectations fall in the future, it is expected to become the best allocation direction.

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Tian Yu, Fund Manager of Zhongtai Asset Management: The moat determines the company’s performance from 10 to 15 years. The more promising companies fail, the more they buy.

A company's long-term profitability does not depend on the growth rate of its industry. The key lies in whether the company's own "moat" is wide. For promising companies, they will choose to buy more when they fall. After the Spring Festival, a group of new fund managers emerged: they either delved into low-valuation targets in cyclical stocks, or they mined value pearls in the Red Sea from the bottom up. Tian Yu of Zhongtai Asset Management Company is one of them.

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Today's news review

The Black Series is "squatting" again! Some cyclical stocks that are close to their lowest limit are also affected! What are the market prospects for joint interviews between five departments?

Domestic commodity futures fell sharply again, with the black series falling particularly significantly. It is worth noting that in the recent continuous decline, the main variety of black futures has experienced a maximum decline of 25% in less than 10 trading days. Perhaps affected by the sharp drop in black commodity futures prices, the black sector of the A-share market adjusted significantly during the session, with the steel sector leading the decline, but the decline was not as large as the previous decline. The coal sector performed relatively well. (Securities Times)

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Suddenly popular! The chairman of the 900 billion giant released a blockbuster signal, and the sector went crazy!

Due to the continued rapid growth of new energy vehicles in recent years, whenever news about power batteries comes out, related concept stocks will be seriously hyped. For example, the previous blade batteries, lithium iron batteries, solid-state batteries, etc. Last weekend, at CATL’s annual shareholders’ meeting, chairman Zeng Yuqun revealed that CATL will lay out sodium batteries around July this year. (Securities Times)

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The fund liquidation process has changed! How big is the impact?

Since the first voluntary fund liquidation in the industry in 2014, fund liquidation has gradually become normalized, and now there is a new situation in this fund liquidation. According to a reporter from China Fund News, the fund liquidation process has been simplified and the original approval system has been changed to a filing system. This also means that the fund liquidation process takes less time. On the one hand, holders can receive liquidated funds faster; on the other hand, it also guides the healthy development of the fund industry and makes the product layout of fund companies more reasonable and scientific. (China Fund News)

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Public offerings are actively deploying Hong Kong stocks and 24 Hong Kong-branded funds are ready to go.

Fund issuance has picked up recently, and Hong Kong stock funds are more popular. Last week, a total of 9 Hong Kong stock technology index products in three categories were approved. Among them, the approved products of Invesco Great Wall, Huatai Songling, Penghua, Cathay and HFT Fund belong to the CSI Hong Kong Stock Connect Technology ETF; China Merchants and Southern Fund products track the CSI Hong Kong Technology ETF (QDII); Ping An Yinhua Fund The product is the Hang Seng Southbound China Technology ETF. In addition, the first batch of Hang Seng Technology ETFs have also been issued and established. (Securities Times)

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The entertainment industry "rebounds" and fund managers outside the industry are at a loss

Recently, the influence list of fund managers on a certain platform was released, once again allowing us to see the huge influence of fans after fund managers leave the industry. However, these fund managers have lost many fans compared to before. In addition, from the perspective of fund managers, the previous trends of entertainment and fandom are "rebounding" fund managers at different levels. The labels of investment, style and image are becoming a burden that many fund managers have to bear. (China Securities Network)

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Infrastructure Curve IPO! This week's first batch of public REITs inquiry The "stock selection" of REITs follows three logics.

Market participants believe that the first batch of nine infrastructure public offering REITs projects is equivalent to nine basic asset IPOs. Previously, relevant fund products have published price inquiry announcements, fund contracts, prospectuses and other announcements on the websites of the Shanghai and Shenzhen Stock Exchanges. Different from ordinary public offering products with a net value of 1 yuan per share, this public offering of REITs uses offline inquiry to determine the fund share subscription price. Similar to IPO inquiry prices, the inquiry price range disclosed by some public REITs fund products is as high as 12.50-14.00 yuan per share. (Brokerage China)

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