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The three major A-share indexes are mixed with coal, real estate and other sectors leading the decline in auto parts, auto chips and other sectors leading the gains [stock market close]
Apr 18, 2022 15:29CST

The three major indices diverged throughout the day, the Shanghai Composite Index fluctuated and adjusted, and the gem index bottomed out and rose by more than 1%. On the disk, the chicken-raising plate rose sharply. Auto parts plate throughout the day strong, individual stocks within the plate set off a stop tide. In terms of decline, the large financial plate adjusted collectively. In addition, the market short-term mood is poor, a number of early high popularity stocks fell to the limit, 3 shares staged "sky floor". On the whole, stocks rose more than fell less, and more than 2800 stocks in the two cities rose. Today's turnover on the Shanghai and Shenzhen stock markets is 778.3 billion, a decrease of 132.9 billion compared with the previous trading day, and the trading volume between the two markets has shrunk sharply today. Plate, chicken, auto parts, pork, auto chips and other plates led the increase, coal, real estate, securities, banks and other sectors led the decline. By the close, the Prev index was down 0.49%, the Shenzhen Composite Index was up 0.37%, and the gem index was up 1.11%. Shanghai and Shenzhen Stock Connect is closed today because of Hong Kong public holiday.

For the future market trend, institutions have expressed their views.

Citic Construction Investment believes that the coming month will be a critical observation period, mainly due to the domestic epidemic, domestic epidemic prevention and economic policies, global inflation, overseas interest rate hikes and shrinking table expectations are still in a negative or chaotic state. The coming month is the key observation period for these conditions to be clear or marginal improvement, and the market may usher in the conditions to confirm the completion of bottoming. A series of issues such as the epidemic in Shanghai, closure and resumption of work, the setting of follow-up economic policies at the Politburo meeting at the end of April, global inflation and expectations of raising interest rates are also important observation points in the future. Before these factors are clear or improved, the market is facing challenges and pressure, investors should be cautious, observe and wait. At present, the market is in the medium-term U-bottom construction period, and it still faces some challenges and pressures in the short term. The tone and configuration are mainly wait-and-see and defense, specific industries pay attention to: banking, agriculture, public utilities, real estate chain, CXO, military industry and so on.

Guosheng Securities believes that this is a restrained reserve reduction, but we should look at it objectively. Looking back, the probability of further rate cuts has been greatly reduced, but the window for interest rate cuts has not been closed, and it is expected that the LPR may still be cut (as soon as April 20), or banks' deposit rates may be cut by a little bit. Continue to remind: the bottom of the policy is already there, the bottom of the economy has not yet arrived, and the bottom of the market will take time. For equities and bonds, the boost to equities and bonds is expected to be limited, given 25BP's restraint and lower-than-market expectations.

China International Capital Corporation believes that, first, the strengthening of structural monetary policy, other channels are also providing liquidity, the urgency of a sharp cut in reserve requirements is not strong. The intensity of the structural monetary policy may be significantly increased this year. 100 billion yuan of small re-loans for supporting agriculture have been allocated in the first quarter, and the two new re-loan lines have also reached 240 billion yuan, and there is still room to increase the amount of small re-loans for supporting agriculture. This year, there may be an accumulative increase of 5000-700 billion yuan in re-loans. In addition to the structural monetary policy, the central bank handed over profits of about 1 trillion yuan this year, and at the end of last year, the central bank lowered the reserve requirement and released 1.2 trillion yuan, part of which was used to replace MLF, with a net investment of 750 billion yuan. In addition to the above channels, the net investment of MLF from January to April this year is 400 billion yuan. Taken together, the above channels provide banks with liquidity of about 2.75 trillion yuan. Assuming that deposits increase by 20 to 21 trillion yuan this year, banks will need to pay about 1.7 trillion yuan more in reserves. The liquidity provided by various channels can basically meet the banks' demand for long-end liquidity, and the urgency of a sharp cut in reserve requirements is not strong. Second, avoid excessive signal effects to disturb the exchange rate. The rapid narrowing of the interest rate gap between China and the United States has brought the pressure of capital outflow. at present, if the monetary easing operation with excessive signal effect is carried out, it is likely to further aggravate the pressure of capital outflow. At present, the central bank may give priority to monetary policy operations with weaker signal effect but stronger actual effect to achieve the goal of stable growth.

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