One Week Investment Strategy Of China Merchants Securities: Medium And Long-Term Transformation&Nbsp; Policy In The Second Half Of The Year

Recently, the strategy research group of China Merchants Securities R&D Center released a one week investment strategy, with the specific contents as follows:

The post cycle consumer goods industry significantly made up for the decline. Last week, the market adjusted and A-H price comparison entered the era of negative premium for the first time. Under the influence of bad information, the essential consumer goods industries with obvious post cycle characteristics, such as medicine, agriculture, forestry, animal husbandry and fishery, have significantly adjusted, while the strong cycle industries, such as aviation airports, banking and real estate, petroleum and petrochemical, have the top performance.

The performance of the industry still fully shows the law of industrial rotation. In July August last year, the real estate industry and the industries it drives took the lead in peaking. Around the end of the year, the investment products with post cycle characteristics such as coal machinery peaked. Recently, the essential consumer goods industries with the most post cycle characteristics, such as medicine and agriculture, began to make up sharply. The process of peaking in different types of industries fully reflects the law of industrial rotation.

The key is what will happen in the future? Will the future market performance start a new cycle of prosperity from the leading industries such as real estate again, or will it continue to engage in consumer goods after the basic consumer goods make up for the decline? The strategy research group of China Merchants Securities believes that if the economic policy is relaxed in the second half of the year and the economic growth is stimulated again according to the old way, the traditional industries related to the real estate industry chain should have the opportunity to rebound, but in the medium and long term, the focus should still be on basic consumer goods. The reason lies in two points: first, the space for policy relaxation in the future is difficult to be as large as that in 2009, and the sustainability and intensity of the rebound in traditional industries cannot be as large as that in 2009; Second, in the medium and long term, China's economy has reached the critical point of transformation. When the next economic cycle picks up again, the driving force of economic growth is likely to be different from the model of the past decade. Therefore, in the medium and long term, the focus of allocation should be on basic consumption and some new industries after making up the decline.

Medium - and long-term transformation, and policy in the second half of the year. The old model of China's economic growth has actually reached its limit, and the future economic cycle must rely on economic transformation. Don't reverse it until you see signs of successful economic transformation, including rising consumption rate and labor productivity. In terms of the second half of the year, the strategy research team of China Merchants Securities tends to believe that the key lies in macroeconomic policies: the fourth quarter of last year and the first quarter of this year were the process of economic and profit growth but policy began to shrink, and the market peaked; In the second quarter of this year, economic growth and profit growth began to decline, liquidity continued to shrink, and the market accelerated to decline; In the second half of the year, it is relatively certain that economic growth and profit growth will still fall, but whether the market will continue to fall or stop falling and rebound depends on the change of macro policies. If the policy is relaxed, the market will enter the process of bottoming and rebound. Source: China Merchants Securities Co., Ltd