A-share market index pressure is heavy and bulls still have some protective energy

category:Finance
 A-share market index pressure is heavy and bulls still have some protective energy


Unfortunately, on the one hand, because of the recent weakness of the A-share market, market participants have no excessive willingness to trade. As a result, after the opening of the new stock market, the pressure on the index has increased rapidly, with the outflow of warehouse cutters and meat cutters. On the other hand, the pace of new stock expansion has been accelerating in the near future, with 9 new stocks subscribing on Wednesday. Although the bidding process will not produce capital diversion effect, too many new shareholders will bring follow-up chain reaction, especially the recent sustained and vigorous reduction of information, so that market participantsconcerns about capital diversion have warmed up.

This made the A-share market open high and go low on Wednesday. The Shanghai Composite Index dived slightly in the afternoon and dipped to 2908.16, which means that the Shanghai Composite Index is expected to quickly fill the gap of June 19. At the same time, after the continuous decline in recent trading days, all short-term and medium-term average of the Shanghai Composite Index have a downward trend, and the short position is very clear. Therefore, market participants are more and more cautious about the follow-up trend.

Bulls still exist

However, as far as the medium-term trend is concerned, the downward space is relatively limited. First, both the Shanghai Composite Index and the GEM Index are at the low level in recent years, indicating that the current trend of the A-share market has reflected most of the pessimistic expectations in the future. As long as there is no new unexpected bad news, the space for further short-selling should not be exaggerated in the current position of A-share market. Second, because the bulls have powerful shield weapons, that is, low-valuation blue-chip stocks, whether they are already in a bull market, food and beverage stocks, bank stocks in a cross-market period, or traditional large-scale index stocks such as PetroChina and Sinopec, their valuations are still in phase compared with their global counterparts. For the situation of low-level enterprises. Especially for large bank stocks with national credit endorsement, the current dynamic P/E ratio is only about 5 times, and the P/E ratio is less than 1 times. Because these stocks have a high proportion of weights in the Shanghai Composite Index, the Shanghai-Shenzhen 300 Index, the Shanghai 50 Index and the Shanghai 180 Index, their declining space is not large, which means that the declining space of these major indexes will not be large. Because of the low valuation of such stocks, and in addition to a certain increase in food and beverage stocks, most of the varieties are still at historically low levels, so they can be a powerful weapon for multi-hair power. If we consider that these weighted stocks and blue chips are core asset stocks in China, foreign capital entering the A-share market, the first thing to consider is the type of allocation of such stocks. Therefore, the continued purchasing power of such stocks can still be expected. Therefore, in the direction of asset allocation, we can still hold a relatively positive strategy, mainly focusing on the invisible champions in the core asset stocks, pharmaceutical stocks, technology stocks and other fields. We believe that over time, it will bring a good return on investment to the holders. Source: Liu Song_NBJ9949

However, as far as the medium-term trend is concerned, the downward space is relatively limited. First, both the Shanghai Composite Index and the GEM Index are at the low level in recent years, indicating that the current trend of the A-share market has reflected most of the pessimistic expectations in the future. As long as there is no new unexpected bad news, the space for further short-selling should not be exaggerated in the current position of A-share market. Second, because the bulls have powerful shield weapons, that is, low-valuation blue-chip stocks, whether they are already in a bull market, food and beverage stocks, bank stocks in a cross-market period, or traditional large-scale index stocks such as PetroChina and Sinopec, their valuations are still in phase compared with their global counterparts. For the situation of low-level enterprises. Especially for large bank stocks with national credit endorsement, the current dynamic P/E ratio is only about 5 times, and the P/E ratio is less than 1 times. Because these stocks have a high proportion of weights in the Shanghai Composite Index, the Shanghai-Shenzhen 300 Index, the Shanghai 50 Index and the Shanghai 180 Index, their declining space is not large, which means that the declining space of these major indexes will not be large.