20180312-川财证券-Chuancai_Securities_Research_Highlights_Weekly_China_Market_Weekly_Outlook_11页_480kb

报告摘要

Market Overview Summary

Core Content

The document provides a detailed analysis of the Chinese equity market performance and outlook for the week of March 5–9, 2018, with a focus on sectoral performance, macroeconomic indicators, and investment recommendations. It highlights the positive impact of market volatility on small and medium cap stocks and emphasizes the importance of policy stability and capital inflows in driving market sentiment.

Key Market Performance

Indices Performance:
- SHCOMP (Shanghai Composite): Rose by 1.62% to 3307.17 points.
- SZSE COMP (Shenzhen Component): Increased by 3.12% to 11194.91 points.
- ChiNext: Grew by 4.77% to 1856.46 points.
- CSI 300: Increased by 2.30% to 4108.87 points.
- CSI 1000: Rose by 3.09%.
Liquidity: The PBOC realized a net return of CNY40 billion, but liquidity in the interbank and equity markets remains sufficient.
Real Economy Resilience: There are no significant signs of a real economy slowdown, and the real economy is considered resilient. However, the determinants need reassessment after the heating season ends and construction resumes.
Market Volatility: The rising volatility is seen as positive for small and medium caps, with well-performing growth stocks likely to be the main rationale for institutional investors.

Industry Highlights

Pharmaceutical Sector

Performance: The sector surged by 6.08%, outperforming the broader market by 3.78%.
Subsector Highlights:
- Medical Services: Led the surge with an 8.14% increase.
- Traditional Chinese Medicine: Smallest growth at 5.27%.
Recommendations:
- Focus on CROs (Contract Research Organizations) benefiting from the generic medicine consistency evaluation.
- Pay attention to pharmaceutical retail companies with a good valuation-earnings match.
Valuation: As of March 9, the sector's PE(TTM) was at a historically low level of 38.37.

Leisure Services Sector

Performance: Rose by 4.02%, outperforming the CSI 300 by 1.72%.
Subsector Highlights:
- SANTE CABLEWAYS (002159.SZ): Turned losses into gains, with 2017 operating revenue up 15.93% YoY.
- CITS (601888.SH): On an upside trend due to the robust duty-free market.
Recommendations:
- Pay attention to consumption upgrade trends.
- Focus on industrial leaders in mid-end hotels and outbound tourism segments.
Companies to Watch: CITS (601888.SH), BTG HOTELS (600258.SH), HNA CAISSA (000796.SH).

Food & Beverage Sector

Performance: Underperformed the SHCOMP by 1.62%, but saw a weekly increase of 0.84%.
Subsector Highlights:
- Rice Wine, Fruit & Vegetable Beverages: Performed relatively well with increases of 3.81% and 3.68% respectively.
Trend: The sector showed a "V shape" trend and is expected to remain lackluster in the short term.
Recommendations:
- Follow underperforming liquor companies and beer, dairy stocks during the sugar and alcohol exhibition in Chengdu.

Light Manufacturing Sector

Performance: Rose by 1.97% to 2971.79 points.
Subsector Highlights:
- Paper Making: Increased due to a new import policy leading to higher waste prices.
- Cultural Paper: Upbeat due to high pulp prices and peak season.
Companies to Watch: SHANYING PAPER (600567.SH), SUN PAPER (002078.SZ).

Electric Equipment Sector

Performance: The wind power industry saw clearance of red alerts in Inner Mongolia, Heilongjiang, and Ningxia.
Subsector Highlights:
- Wind Power: Reduced curtailment rates and falling equipment costs stimulated new installations.
- Distributed & Offshore Wind Power: Expected to see increased capacity.
Recommendations:
- Pay attention to industrial leaders and the improved profitability from reduced curtailment.

Chemistry Sector

Performance: High prosperity due to environmental protection pressures.
Subsector Highlights:
- Dyestuffs, Pesticides, Titanium Dioxide, Chlor-Alkali: Industries under pressure due to overcapacity reduction and environmental regulations.
- Dyeing and Printing Industry: Leading company ZJHM (600987.SH) raised prices, signaling potential for others to follow.
Recommendations:
- Watch for dyestuff price increases and related companies such as ZHEJIANG LONGSHENG (600352.SH), RUNTU (002440.SZ), and JIHUA GROUP (603980.SH).

Coal Industry

Performance: Fell by 0.48%, while the CSI 300 rose by 2.30%.
Subsector Highlights:
- Thermal Coal: Likely to see a downside trend due to off-season and increased supply.
- Coking Coal and Coke: Prices maintained an upward trend, with steel enterprises increasing inventory.
Recommendations:
- Monitor potential M&A activity in the coal and power sectors.
- Companies to watch: SCIE (600546.SH), CHINA COAL ENERGY (601898.SH).

Home Appliance Sector

Performance: Ranked 8th among all A-share sectors, with a rebound in stock prices.
Subsector Highlights:
- TV Segment: Surged due to declining panel costs and improved profitability.
- Sales Data: January sales remained steady, and February sales were robust due to Spring Festival demand.
Recommendations:
- Pay attention to well-performing industrial leaders that had earlier plunged.
- Companies to watch: MIDEA GROUP (000333.SZ), SUPOR (002032.SZ), SANHUA (002050.SZ).

Risk Reminder

Macro-Policy Changes: Risk associated with major policy shifts.
Systematic Risk: Market-wide risks.
Data Delay: Potential for delayed data affecting analysis.

Analysts and Contact Information

Analysts:
- Li CHEN: SAC Reg. No: S1100517060001, Tel: 8610-66495901, Email: chenli@cczq.com
- Peng WANG: SAC Reg. No: S1100516120001, Tel: 8621-68595118, Email: wangpeng@cczq.com
Contact:
- Wenyi ZHOU: SAC Reg. No: S1100117120006, Tel: 8610-66495910, Email: zhouwenyi@cczq.com

Disclaimer

This document is for the information of Chuancai Securities Limited's clients only.
Information is based on sources believed to be reliable but is not guaranteed.
The document does not constitute an offer or solicitation to buy or sell securities.
Investors are advised to consult their own financial advisors.