a shares are on the hot search list again.
In early trading today, A-shares continued yesterday's decline and opened lower. The Shanghai Composite Index fell below 2,800 points, a new low in more than three and a half years; the Science and Technology Innovation 50 Index hit a new record low, with more than 4,900 stocks in the two cities falling.
The market was lackluster. Most industry sectors fell. Only a few sectors such as BC batteries and communication equipment were slightly active.
Institutions began to be "greedy"
Since 2024, A-shares have continued to be under pressure. However, as the market fell, institutions began to become "greedy".
CITIC Securities said that pessimistic expectations have bottomed out, an inflection point is coming, and A-shares are expected to recover in the next two months. From a valuation perspective, the valuations of major indexes, industries and institutional heavyweights have all entered historical extreme areas, and insurance capital and active private equity are expected to be potential sources of incremental funds.
UBS Securities believes that the current corporate profits and policy expectations are both positive. Although the performance of A-shares after the third quarter of 2023 is relatively weak, corporate profits have actually seen signs of bottoming out. In 2024, the Shanghai and Shenzhen 300 Index The year-on-year earnings per share growth rate is expected to rebound to 8%. In terms of policy, easing efforts are expected to be stronger, and clearer fiscal and credit policy support is expected to boost the stock market.
million funds said that the trend of A-shares throughout the year may show a "V" shape. In terms of rhythm, the investment direction in the first quarter was "procyclical", focusing on resource stocks and infrastructure chains; in the second quarter, market volatility increased, and the style was biased towards low valuations and dividends, focusing on energy, transportation, finance, military industry, etc. As liquidity may turn loose in the first half of the year, the style is expected to shift to growth, focusing on TMT related to the digital economy (AI, Xinchuang, semiconductors).
Haitong Securities pointed out that the current valuation of A-shares is at a historical bottom, and there may be periodic opportunities in finance. As policies to stabilize growth and prevent risks continue to increase, big finance may have opportunities for periodic performance. The 2023 Central Financial Work Conference proposed “optimizing the debt structure of central and local governments”, “activating the capital market”, and “cultivating first-class investment banks and investment institutions”. If the above-mentioned relevant policies can be introduced and implemented in the first quarter of 2024, the valuations of banks and securities firms that benefit from the policies may be restored, and it is expected to usher in phased opportunities.
It is worth noting that although the A-share market fell sharply in the morning, forward call options surged across the board. For example, the CSI 500etf March 6250 contract once soared by more than 121% during the session, and the 500etf March 6500 contract also rose once. More than 106%, and several forward varieties have increased by more than 50%.
Communication Equipment was active against the trend.
Communication Equipment sector once rapidly rose by nearly 1% during the session, and the half-day transaction was close to yesterday's full-day transaction. Cambridge Technology opened higher and moved higher, sealing the daily limit in a straight line, and transactions increased sharply; Industrial Fii, Xinyi Sheng, Liant Technology, etc. also bucked the trend and strengthened.
According to the Radio Administration Bureau of the Ministry of Industry and Information Technology, the Ministry of Industry and Information Technology recently organized the selection of the second batch of radio transmitting equipment model approval self-inspection and self-certification pilot enterprises. After voluntary declaration by enterprises, preliminary review by provincial radio regulatory agencies and expert review, 10 companies including Datang Mobile Communications Equipment Co., Ltd. are planned to be selected as the second batch of self-inspection and self-certification pilot companies, with the pilot period valid for 2 years.
In recent years, my country has introduced a number of policies to encourage and support the development of the communications industry. According to the "14th Five-Year Plan for the Development of the Information and Communications Industry", by 2025, the overall scale of my country's information and communications industry will further expand and the 5G access rate in administrative villages will reach 80%. There are 26 5G base stations per 10,000 people.
The "Electronic Information Manufacturing Industry 2023-2024 Stable Growth Action Plan" jointly issued by the Ministry of Industry and Information Technology and the Ministry of Finance last year mentioned that in 2024, 5g mobile phone shipments in my country's mobile phone market will account for more than 85%, and the industrial structure will continue to be optimized, with industrial clusters Construction continues to advance, forming a good situation in which upstream and downstream are connected, coordinated and mutually promoted.
Overseas 5G network construction is also gradually starting. According to gsma, global mobile operators will face more than US$600 billion in capital expenditure investment needs from 2022 to 2025, about 85% of which will be in 5g networks. my country leads the world in 5G technology, and relevant companies will benefit deeply from the global wave of 5G network construction.
Industrial Securities stated that the downstream demand structure of the communications industry has undergone qualitative changes, from traditional operators to new downstream industries such as cloud computing, new energy, AI, and satellites, all of which have room for an output value of over 100 billion. Looking forward to 2024, the communications industry may still have excess returns. We are optimistic about the three major investment directions of computing power, terminal recovery and satellite communications. Operators still have good allocation value.
Editor: Peng Bo
Proofreader: Liao Shengchao
