There is a high probability that the first half of this year will not be bad. Expectations and sentiments resonate. Favorable policies and the fulfillment of expectations at the initial stage interact with each other, superimposed and strengthened.
$XIAOMI-W(01810)$
On the domestic front, the economy is really bad. The Spring Festival and the epidemic in January shut down work and production early, becoming the lowest point in decades. When the Spring Festival returns in February, the chain will definitely improve. It will continue in March, and a new team will take office in April. The policy is expected to continue work hard. Therefore, in the first half of the year, liquidity will be loose, policies will be increased, and the impact of the epidemic will subside, which will drive expectations to improve, sentiment will pick up, and economic data will bottom out, initially fulfilling recovery expectations. Even if the recovery is not as good as expected, the market will most likely choose tolerance in a favorable macro environment and relatively optimistic sentiment.
In the United States, the effect of interest rate hikes has further emerged. Wage growth has been controlled, unemployment rate has risen marginally, inflation continues to develop in a controlled direction, and the rise in interest rates has come to an end. The market is concerned about whether the economy will have a soft landing and whether interest rates will be cut in the second half of the year. In a worse case, the U.S. economy will stall and fall into recession. Even so, the recession will also bring expectations of interest rate cuts, and the depth of U.S. stock market adjustments will be limited. If the data shows that U.S. inflation is under control and achieves a soft landing, it will start a new round of bull market.
In today's world, the economies of China and the United States dominate the direction of the global market. If there is no black swan incident of the Russia-Ukraine conflict, there is a high probability that the first half of the year will be relatively safe. The opportunities outweigh the risks. If you want to make progress, you should grasp the first half of the year.
The second half of the year will be more complicated. China reopens, demand increases, and commodity prices rise. The market adjusts inflation and interest rate expectations. Whether the economic recovery can meet expectations and support the previous growth rate are all uncertain factors.
At the beginning of January, the time to increase positions in A shares was clear, and the investment clock was Hong Kong stocks - US bonds - A shares - US stocks. In recent years, the phenomena that are common in every market, such as the rise of the RMB exchange rate, loose liquidity, supportive fiscal policy, recovery of expectations and confidence, large-scale increase in Northbound positions, relatively stable (flat) Sino-US/international relations, etc., already exist. Hong Kong stocks also took the lead in rebounding 50%+ from their lows to enter a bull market, and A-shares also stood on the yearly line, showing a positive trend. Whether A-share transactions can be effectively and continuously enlarged after the festival will determine the height of this round of market conditions. The performance of A-shares and US stocks will also determine the uptrend and stamina of Hong Kong stocks.
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