A big review of this week

1. The Prev fell 4.31% this week because of concerns about structural policies, epidemics, China, the United States and other events. From the perspective of the split plate, the Shanghai 50 and Shanghai and Shenzhen 300 fell even more, falling 6.69% and 5.46% respectively.

2. Affected by regulatory policy concerns, there was a panic sell-off in the overseas Chinese stock market this week, affecting A shares and the RMB exchange rate. The education and internet sectors bore the brunt of the sharp decline, while other industries were not immune from the sell-off. Overall, the MSCI China Index fell 6.1%, the Hang Seng Technology Index plunged 7.0%, the Hang Seng Index fell 5.0%, and the Hang Seng China Enterprises Index fell 6.2%.

3. The political Bureau of the CPC Central Committee held a meeting on July 30 to analyze and study the current economic situation and make arrangements for economic work in the second half of the year.

Ping an Securities: six interpretations of the 7.30 Politburo meeting

On July 30, the Central Committee held a meeting of the Politburo, which sent the following signal:

First, be cautiously optimistic about the economic situation and confirm that there is downward pressure on the economy.

Second, the policy emphasizes cross-cyclical adjustment, and the overall convergence of macro policies this year and next means that macro policies are evolving in the direction of soundness and looseness.

Third, monetary policy should maintain reasonable and abundant liquidity and enhance macro policy autonomy. When the Federal Reserve communicates with Taper in the second half of the year, monetary policy will not follow.

Fourth, special bonds are issued steadily, mainly in the fourth quarter and the first quarter of next year.

Fifth, new energy, hard technology and the "three-child policy" are stable long-term policy starting points and contain investment opportunities.

Sixth, continue to prevent and defuse financial risks in key areas, which is mainly reflected in: first, the implementation of the financial and financial risk management mechanism responsible by the main leaders of the local party and government. The Politburo meeting in April declared that it was "established", indicating that the relevant mechanism has been established. Second, the regulation and control related to real estate will not be relaxed, speed up the development of rental housing, implement land, tax and other support policies to alleviate the housing problem of young people flowing into big cities.

Bank of China International: looking at Investment opportunities in the second half of the year from the Politburo meeting

Under the setting of cross-cycle adjustment, the sustainability of policies brings about the sustainability of economic growth and corporate profits.

Actively pay attention to the bubble market of the leading industry and the profit revaluation space of the cyclical industry; take a neutral view of some consumer industries that cause fertility anxiety and investment opportunities of Chinese stocks and Internet platforms under strong supervision.

From the mid-cycle perspective, the bubble of new energy and semiconductors as the leading industry has its inevitability, which can be compared with the path of the "science and technology bubble" communications industry in the United States. The investment logic of the cyclical industry is transitioning from rapidly rising commodity prices to profitability sustainability and capacity revaluation, while downstream emerging demand and low and medium valuations have also opened up the upside of the industry.

The subsequent adjustment of internal and external institutions will strengthen the structural differentiation of the A-share market. In investment, we should pay attention to the forward-looking guidance of this Politburo meeting and respond actively.

Guotai Junan: bottom area, build up momentum to welcome new students

After the recent market adjustment reached the bottom position, with the SSE 50 stabilizing + medium and small market capitalization style to pull up the momentum is abundant, the market is expected to gain momentum to welcome new life. Based on the downside of risk-free interest rate and risk assessment, we should grasp the mid-market blue chip and science and technology growth.

We believe that the current fundamentals have not substantially deteriorated, and the micro-market trading structure of some tracks has not reached the threshold, and this adjustment is a panic disturbance rather than a systemic risk. Under the extreme differentiation, the growth of science and technology is the first choice, with emphasis on the second and third lines. The ultimate structural interpretation, the market is worried about the pullback of the strong plate.

The business cycle of science and technology manufacturing plus top-down catalysis is still our primary recommended direction. High volatility in stock prices is inevitable, but it is by no means the end.

Industry recommendation: 1) Industry cycle up: semiconductor (Broadcom Ltd Integration / Jingfang Technology) / New Energy vehicle / Lithium Power (Ganfeng Lithium / Xingyuan material) / Photovoltaic (Daquan Energy) / equipment (to Pure Technology)

2) cyclical growth varieties with excellent performance-to-price ratio in profit valuation, preferably those with stable supply and demand in the medium term: building materials (Qibin Group) / Iron and Steel (Valin Iron and Steel), etc.

3) there is no room for downward, and the pull-up is gaining momentum: brokerage (Oriental Wealth)

Anxin Securities: wait for stability, growth and then layout

We continue to maintain the medium-term strategic outlook of "bull heart and bear courage, grow to be king" judgment. On the whole, the market shows the characteristics of stock game. In the short term, the scale of fund issuance and redemption is basically the same, foreign capital is difficult to have large-scale inflows, and the follow-up IPO scale is larger, and other factors may lead to adverse conditions for incremental funds and greater upward resistance to the market.

From a fundamental point of view, due to the resurgence of the epidemic at home and abroad, the domestic real estate cycle and other factors, economic downward pressure may become the main source of market concern in the future stage, consumption is expected to remain weak, real estate chain, export chain downward pressure is greater. From the perspective of market risk preference, we believe that the market's anxiety about industry policy and foreign capital outflow has been basically released, and the possibility of a further sharp decline is not high.

From a policy point of view, the Politburo meeting once again mentioned "cross-cycle adjustment" and paid attention to the convergence of macro policies this year and next. New energy vehicles and specialized new small and medium-sized enterprises have become the focus of development, and continue to be conducive to the performance of small and medium-sized growth styles in the future.

Generally speaking, due to the increasing downward pressure on the economy and the short-term shortage of market incremental funds, the market may continue to be in the adjustment stage in the short term, and some popular tracks will also face greater adjustment pressure. In the medium to long term, the logic of A-share growth bull and the main line of growth medium-term is still valid, and the structural bull market of growth stocks is expected to continue after the end of the adjustment period.

It is recommended that investors wait for the market to stabilize, bargain-hunting photovoltaic, military, new energy vehicles, semiconductors, automobiles, 5G, CXO and other high-view long track key directions.

CICC: overseas Chinese capital stock market is expected to gradually stabilize

Market outlook: panic sentiment superimposed southbound capital outflow increased the downward pressure on the market. Policy uncertainty, especially the higher-than-expected regulation of out-of-school training in private education, worried investors and became a direct catalyst for a sharp sell-off in Hong Kong stocks last week, against the backdrop of a general pullback in new economic sectors such as education and the Internet.

In addition, investors are also worried that regulatory policies may soon spread to other industries, so panic has spread to other sectors and markets as a whole, dragging down a general correction in Hong Kong and the A-share market. At the same time, fears that the US might restrict Chinese investment and a sharp outflow of southbound money fuelled the sell-off.

However, although regulatory uncertainty may continue to lead to volatility, we believe that from a technical and short-term point of view, last week's sell-off may have taken into account a lot of panic, so the market may gradually enter the "layout area", mainly based on the following three points of observation of ∶

Short-term market sentiment shows signs of panic, such as Hong Kong's main board trading volume rose to an all-time high last Tuesday, short selling rose, the dividend yield of the MSCI China Index exceeded the yield of 10-year Chinese government bonds, and so on.

2) regulators sent a positive signal last Wednesday to appease the market panic. Regulators pointed out that recent policies are targeted, rather than trying to crack down on other industries, while reiterating China's position on attracting foreign investment.

3) on the capital side, at present, there may also be too much concern about the withdrawal of overseas funds. Last week, overseas funds still showed a net inflow trend (mainly passive funds), and there was no significant outflow as feared by the market. Therefore, while regulatory risks may persist and cause short-term volatility, we believe that long-term investors may find investment opportunities after the recent market sell-off. As the panic abates, the market may also get some short-term support.

Investment advice: after the recent market sell-off, we think the market will get short-term support as panic alleviates. For some sectors that have suffered excessive selling and still have attractive valuations, such as health care and some technology giants, investors can lay out their potential rebound.

In the long run, we suggest paying attention to China's long-term trends, such as industrial upgrading and consumer upgrading, as well as the rise of domestic consumer brands. We believe that the leading enterprises in the electric vehicle industry chain, new energy, advanced manufacturing and consumption and health care will benefit from China's long-term economic growth.

Attachment: the first choice of A shares and Hong Kong stocks of CICC in August

A total of 18 A shares have been transferred to the industry in this period.Including: northern rare earths, Huayou Cobalt, Oriental Yuhong, Xianhe, Xinan, Luxi Chemical, Xinyichang, Jingsheng Mechatronics, Kodali, AVIC Shenfei, Huadian International, Shanghai Jiahua, Chengguang Stationery, Taiping Bird, Biyin Lefen, Midea, Jianghuai Automobile and Silverwheel shares.

A total of 16 A-shares have been transferred out of the industry.Including: Zijin Mining Group, China Molybdenum, Beixin Building Materials, Ashi Chuangneng, New Zebang, Yizimi, Hangke Technology, Ruike Laser, Torch Electronics, Huaxia Airlines, Industrial Bank, Peraia, healthy Medical, Aojiahua, Changan Automobile and Huayu Automobile.

A total of 7 overseas Chinese stocks have been transferred to the industry in this period.Including: Ganfeng Lithium, Pacific Shipping, Longfor Group, Country Garden Services Holdings, Li Ning Co. Ltd., Xtep International and Great Wall Motor.

A total of 9 overseas Chinese stocks have been transferred out of this issue.Including: Zijin Mining Group, Dada Nexus Limited-US, Xuhui holding Group, Yashi Service, Shenzhou International Group, Chow Tai Fook Jewellery, Haidilao International Holding, Fuyao Glass Industry Group and Li Auto Inc.-US.