Residents deposits moving to stock market? Household deposits dropped by more than 700 billion in July

category:Finance
 Residents deposits moving to stock market? Household deposits dropped by more than 700 billion in July


Wang Qing, chief Macro Analyst of Dongfang Jincheng, said that the small increase in deposits was mainly due to the decline in the growth rate of RMB loan balance of financial institutions and the slowdown in the growth of derivative deposits.

It is worth noting that in July, residents deposits fell by 719.5 billion, a decline beyond the seasonality. At the same time, non bank deposits increased by 1.8 trillion yuan. Combined with the frequent occurrence of funds with partial shares in July, it means that some residents deposits may flow into the stock market.

Similar phenomena occurred in April and may of 2015. When the stock market is booming, residents deposits flow into the stock market, and they enter the stock market by directly participating in the secondary market of the stock market or issuing new stocks, and indirectly applying for funds and financial products. The reduction of residents deposits may be reflected in the deposits of non banks, in the form of securities margin.

Huang Weiping, chief fixed income analyst of Societe Generale Securities, said that in the future, the earning effect of the stock market will be weakened in the short term, and the speed of resident deposits flowing into the stock market may slow down. However, in the medium term, with the phenomenon of breaking through the net value of financial management becoming more and more common, as well as the low rate of return on goods, it may be the general trend for residents to increase the allocation of equity assets.

Stock is better than debt

In addition, the growth rate of social finance continued to rise to 12.9% in July, which was also the highest in two years.

Wang Qing, chief Macro Analyst of Dongfang Jincheng, said that the growth rate of M1 reached a new high in more than two years in July, indicating that with the continuous progress of economic recovery, the business activities of various market entities tend to be active, and the warming of the real estate market also plays a direct role in promoting the growth of M1.

Li Chao, chief economist of Zheshang securities, said that m2 and social financing growth are the core intermediary targets of monetary policy, but social financing is more important for the stock market. Social finance represents the overall financing scale available to entities, including indirect, direct and non-standard financing and other multi-channel funding sources. Social finance is more indicative to economic fundamentals and stock market. In July, M2 growth rate fell down month on month, but the social financing growth rate reached a new high, and the stock market was still sustainable. In the follow-up, it is necessary to take a clear shift in monetary policy as a risk point in the stock market and focus on the Politburo meeting at the end of October. Huang Weiping said that the financial data in July further confirmed the monetary policy keynote of stable currency + structural broad credit, the slope of total easing slowed down, and the structural orientation was clearer. In this environment, stock is better than debt, credit is better than interest rate, coupon is better than capital gain. Extended reading of non Sunshine Business reveals that case in case GDBs claim of 300 million yuan has been rejected by the final adjudication and Indias provocation! Huawei and ZTE are to be banned from participating in 5g construction. Two companies respond to the Grain Bureau: the cumulative purchase of wheat in the main production area has decreased by nearly 10 million tons on a year-on-year basis. Source: 21st century economic news editor in charge: Zhong Qiming_ NF5619

Li Chao, chief economist of Zheshang securities, said that m2 and social financing growth are the core intermediary targets of monetary policy, but social financing is more important for the stock market. Social finance represents the overall financing scale available to entities, including indirect, direct and non-standard financing and other multi-channel funding sources. Social finance is more indicative to economic fundamentals and stock market. In July, M2 growth rate fell down month on month, but the social financing growth rate reached a new high, and the stock market was still sustainable. In the follow-up, it is necessary to take a clear shift in monetary policy as a risk point in the stock market and focus on the Politburo meeting at the end of October.