Tuesday , January 31 2023

Zhengyan Observer: politically motivated sub-investors are eager to be optimistic about 2019 | Daily Economic News


Last week, the A part began with almost unilateral decline. SSE 50 indexes with heavy weight decreased by 4.84%. Shanghai Composite Index dropped by 2.99% to 2516.25 points and Shenzhen Composite Index dropped by 3.22% to 1284.66 points, while the SME Composite Index and Growth Facility Market Composite Index dropped 3.64% and 2.59%, respectively .

Last week, the shares of the bank were inconsistent and the crude oil prices shifted to stop the price increase of the "two barrels of oil" securities, which, as a rule, led to the fall of heavy loads. Additionally, by the end of the year various funds will have a naturally performance rating. At some low levels, some financial resources want to maintain relative ratings that further enhance the impact of negative news and cause slippery impulses.

Federal Reserve raised interest rates as expected last week. At the same time, the Central Bank of China carried out a targeted rate cut by creating TMLF (its main objective is to encourage lenders to small and micro-enterprises). As you can see, China-US interest rates began to fluctuate in the opposite direction. Can this situation continue, basically, depending on the increase in interest rates of the Fed next year? If the Fed only raises one or two interest rates next year, this will be sustainable and vice versa. The current situation is that the U.S. shares are not far from the bear market, but the external interference that the Chinese central bank has adopted partial easing policy weakens.

The US shares have fallen sharply on Thursday and the A-shares open on Monday are likely to be naturally big, but I think the A-shares can not continue to be under pressure, and can not exclude the likelihood of a retreat. Nevertheless, the A part of this week is also difficult because it is the last trading week of 2018. Due to historical experiences, the market is often difficult at this time. As for transactions, investors should, in spite of some short-term fluctuations, make the stock market better after this process.

The Central Economic Business Conference has come to an end. The meeting drew attention to the need to strengthen counterclically the regulation of macroeconomic policies and to pursue proactive fiscal policies and a prudent monetary policy. An active fiscal policy should "strengthen efforts to increase effectiveness" and "carry out more tax cuts and lower payments", a stable monetary policy should be tight and robust, should provide liquidity and have reasonable abundance, and should be a challenge for private enterprises and small and micro businesses must resolve. The question.

From this point of view, the bottom line of politics is a highly probable event. At the same time, I think macroeconomics can not go beyond the economy.

When Dow drops for the fourth time, the moon will go on the market. After a month on the US stock market, the probability of the early end of the US interest rate cycle will increase and US policy makers will continue to trade friction. In other words, the external situation may seem a bit tough, but at any time there may be a braking point and investors want the market to be optimistic in the 2019 market.

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