Market Outlook: Retrograde the monthly income since the beginning of this year
We use the monthly investment cycle to trace the yield of investing in various term interest rate bonds this year, including 1-year AAA interbank certificates of deposit, 3-year NTD bonds, 5-year NTD bonds, 7-year NTD bonds, 10-year NTD bonds, and rolling 7-day repurchase. The investment cycles are purchased from the beginning of the month and sold at the end of the month, and the total investment return rate for one month is calculated.
Among them, the total yield of the investment bond includes the coupon rate and the net price of change rate of return. Coupon rate of return = Buy maturity rate/12, net price change rate = (return on maturity rate at the beginning of the month - return on maturity at the end of the month) × duration
7-day repurchase total investment return is the 7-day repurchase at the repurchase rate at the beginning of the month. After maturity, the principal and interest will be invested for another 7 days, and the total interest rate will be rolled to the end of the month.
The specific calculation results are as follows:
When the bond interest rate rises, it will have a negative impact on the net bond price. In February and June this year, due to the rise in interest rates, the monthly investment yield of investing in 10-year NTU bonds will be lower than the yield of rolling 7-day repurchase. Therefore, judging the future bond interest rate trend is very critical to making a decision to invest in long-term bonds or to place a 7-day repurchase. At present, the monthly return rate of rolling 7-day repurchase in September is about 0.12%. If the maturity rate of 1-year AAA interbank certificate of deposit, 3-year NTD bond, 5-year NTD bond, 7-year NTD bond and 10-year NTD bond rose by 5bp, 3bp, 2bp, 2bp and 1.3bp respectively at the end of August, the total monthly yield of investing in these bond varieties will underperform the yield of rolling borrowed funds.
Last week's high-frequency data tracking: upstream production repair, construction speed up
(I) Production: Steel chemical repair, automobile fall
(1) Steel production continues to be repaired. In the week of September 16, the blast furnace operating rate of Tangshan Steel Plant increased by 3.2pct month-on-month to 59.5%, maintaining an increase for two consecutive weeks, and the growth rate has expanded; the capacity utilization rate of Tangshan Steel Plants increased by 2.4pct month-on-month to 76.3%, 9.0pct higher than the same period last year. The impact of high temperature and power limit has basically subsided, and production conditions have continued to improve. rebar -week production fell slightly month-on-month, down 0.2% on the week-on-month to 3.071 million tons, ending the seven consecutive weekly recovery trend.
(2) The overall chemical production rebounded. In the week of September 15, the load rate of in the PTA factory increased by 0.5pct month-on-month, the load rate of Jiangsu and Zhejiang looms increased by 7.3pct, and the operating rates of polyester filament and Jiangsu and Zhejiang looms rose by 0.9pct and 4.2pct week-on-month, respectively. They have maintained a rebound trend for three consecutive weeks, reflecting the accelerated recovery of the chemical industry chain.
(3) Automobile production continues to decline. In the week of September 15, the operating rate of automobile semi-steel tires was 56.0%, a week-on-month decrease of 6.0pct, 3pct higher than the same period last year; the operating rate of automobile all-steel tires was 50.4%, a week-on-month decrease of 4.0pct, 8.1pct lower than the same period last year.
(II) Demand: Construction has accelerated, export growth has slowed down
(1) Infrastructure: Steel prices have risen overall. Last week, the prices of rebar, wire and cold coils all turned from a month-on-month decline, with week-on-month 0%, 0.95% and 0.67% respectively; hot coils maintained an increase, with week-on-month price rising by 0.81%, and 's increase by expanded. Rebar inventory rebounded, with inventory rising by 3.3% month-on-month, from destocking to cumulative inventory. On September 14, the operating rate of petroleum asphalt equipment rebounded by 4.8pct to 44.5%, with a significant increase, pointing to the acceleration of the recovery of infrastructure construction. On September 9 (latest data), the cement shipment rate rose by 5.3pct, and the operating rate of mill continued to rebound, up 1.1pct on the weekly basis. Last week, the weekly average of the cement price index oscillated slightly month-on-month, with a weekly average of 145.4%.
(2) Real Estate: Real Estate sales continue to decline. Last week, the average daily transaction area of commercial housing in 30 cities fell by 1.2% month-on-month, among which the second-tier cities (up 7.7%) first-tier cities (down 1.0%) third-tier cities (down 16.8%) have passed the "Golden September" marketing node, and real estate sales are still sluggish. Since September, real estate sales in 30 cities have dropped by 23.2% year-on-year. In terms of land acquisition, the land transaction area of on September 11 was 15.56 million square meters, a month-on-month decrease of 16.2%, and the land premium rate of is 53.76%.
(3) Consumption: The growth rate of automobile sales slows down. From September 1 to September 12, the retail and wholesale of the passenger car market increased by 0% and 19% year-on-year respectively, with the growth rate slowing down. The China Passenger Car Association said that this year's Mid-Autumn Festival will be on September 10. Since some regions encourage local festivals, the market is relatively silent. Last year's Mid-Autumn Festival was on the 21st, the third week of September. The time difference of the lunar festival caused disturbances to retail in the first week.
After the Mid-Autumn Festival holiday, the movie box office and the number of viewers fell significantly on the weekly basis, down 38.9% and 38.6% respectively, and down 22.1% and 25.7% year-on-year in September. The average congestion delay index in 100 cities rose by 1.2% month-on-month. Last week, the subway passenger volume in 13 key cities increased by 0.9% month-on-month. Among them, the subway passenger volume in Shanghai, Beijing, Guangzhou and Shenzhen fell by 8.7%, 15.9%, 2.2%, and 31.0% month-on-month respectively, indicating that the passenger flow in tourist cities such as Beijing and Shanghai has declined after the holidays. At the same time, the current round of epidemic in Shenzhen has basically ended, and the passenger flow has rebounded significantly.
(4) Foreign trade: Container throughput increases negatively year-on-year. Last week, the Baltic dry bulk index (BDI) rose 28.6% month-on-month, with an increase of somewhat widening; CCFI and SCFI indexes fell 4.2% and 9.7% respectively; since September, the monthly averages of CCFI and SCFI indexes were -14.27% and -43.92% year-on-year respectively, with a significant increase in the decline, indicating that overseas demand continues to cool down. On September 10, the container throughput of the eight major hub ports was -16.1% year-on-year, and the growth rate has dropped significantly since September, indicating that the downward pressure on my country's exports has increased.
(III) Prices: Food prices turn from rising to falling, and the decline in international oil prices has expanded
(1) Most agricultural product prices have fallen. Last week, the wholesale price index of agricultural products fell by 0.5% month-on-month (the previous value rose by 2.7%), among which pork (up 1.1%), eggs (down 1.7%), fruits (down 1.9%), vegetables (down 2.7%). After the Mid-Autumn Festival, the demand for most agricultural products decreased, and vegetable prices fell at a high level. Since September, the country and various regions have simultaneously launched the government’s pork reserve release work. It is expected that the country and various regions will release a total of about 200,000 tons of pork reserves in September, and the monthly release volume will reach the highest level in history.
(2) crude oil price fell sharply. On September 16, the spot prices of Brent and WTI crude oil were 91.1 and 85.1/barrel respectively, with weekly averages falling 8.5% and 5.7% month-on-month, respectively, with a widening decline. The U.S. inflation data in August was higher than expected, and the market expected that the Federal Reserve would aggressively raise interest rates, and oil prices fluctuated and fell. Last week, the CRB commodity price index rose by 1.41% month-on-month, the average value of the Nanhua Industrial Products Index rose by 2.95%, the closing price of the Qinhuangdao Port power coal closed price -week average price increased slightly, up 4.62% week-on-month, and the settlement price of thermal coal futures maintained a slight increase, up 0.72% week-on-month.
Monday strategy review
Economic improvement may be continued: Hua Venture Capital Advisory Department Bond Market Early Trading (2022-9-19)
[Hui Venture Capital Advisory Department Market Tracking] Last Friday US stock fell, hitting a two-month low, the energy sector led the decline, FedEx fell by more than 20%, and the largest day drop in the day since its listing forty years. The yield on the 2-year US bond rose to 3.92%, and then fell back to 3.87%, and fell back to 3.45% in 10 years. USD index fell intraday; offshore RMB appreciated to within 7; crude oil rebounded slightly.
Overseas market: (1) The initial value of the University of Michigan consumer confidence index in the United States in September is 59.5, lower than the expected 60, but the highest since April. The final value of inflation expectations in 1 year is 4.6%, the lowest since September 2021; the initial value of 5-year inflation expectations is 2.8%, the lowest since July 2021. (2) Russian President Putin delivered a speech saying that Russia has not adjusted its plan for special military operations against Ukraine. Although the Ukrainian army is currently trying to launch a counterattack, "liberation" of the Donbass region in eastern Ukraine is still Russia's key and main goal, and this work is still continuing.
Domestic aspects: (1) Hainan Provincial Government issued the "Hainan Province Special Measures to Stabilize the Economy and Help Enterprises to Relieve Difficulties and Development (Version 2.0)", proposing to relax purchase restrictions and vigorously stimulate automobile consumption. From September to December this year, the restrictions on purchasing small passenger cars will be relaxed in phases, the expired unused indicators will be activated, the number of incremental indicators for ordinary small passenger cars will be increased in phases, and the qualification requirements for applying for the incremental indicators for ordinary passenger cars will be relaxed in phases.(2) In terms of the epidemic, national data has slowed down. Chengdu City Notice that the city will resume production and living order in an orderly manner from 0:00 on Monday, September 19. (3) The Tianjin Housing and Urban-Rural Development Commission and seven other departments issued the "Notice on Further Improving the Real Estate Regulation Policy and Promoting the Healthy Development of the Real Estate Industry", supporting new citizens and college graduates who are not registered in the city and are employed in the city, and can purchase one house in the city with 6 consecutive months of social insurance or personal income tax proof for . The Binhai New District still implements the original policy of buying houses.
Today's bond market is concerned:
(1) Overseas market, this week, pay attention to the fed interest rate meeting in the early morning of Thursday, Beijing time. Currently, the probability of raising interest rates is high. More importantly, the expectation of Fed's future interest rate hike path, which will have a greater impact on the global financial market.
(2) Domestic, August macro data was released last Friday, and the growth rate of production, investment and consumption all rebounded, and the contribution of base effect was superimposed on August's month-on-month rebound. The reason for economic improvement is that the policy of stabilizing growth is easier to achieve effectiveness in infrastructure investment, and the high growth in infrastructure and manufacturing investment has hedged the sluggish real estate industry, and the factors of the high temperature epidemic have greater constraints on production and consumption recovery.
Overall, the economy in August has initially improved compared with July. Looking back, the high temperature factor has subsided and construction will accelerate, which is conducive to the release of infrastructure investment in the pulling effect of upstream industries; on August 24, the State Council added 300 billion policy-based development financial tools, and many places continued to relax real estate policies, and the manufacturing tax reduction and tax refund policies were added again. With the increase in policies, the trend of improvement of macroeconomic may continue.
In terms of the bond market, the macro data in August improved, and the entry of funds into the entity after the implementation of macro policy led to a slight rebound in capital interest rates. In addition, bond interest rates are at an extremely low position in history and lack security, so we still need to pay attention to the risks of adjustments.
4-day reverse repurchase restarts, in line with the seasonal rules: Hua Venture Capital Advisory Department’s bond market midday strategy (2022-9-19)
[Hu Venture Capital Advisory Department Market Tracking] The interest rate rose slightly in the early trading on Monday, with tight funds, and the short-term interest rate rising even more. In terms of the stock market, it was still weak in the early trading, with software, infrastructure, military industry, and semiconductors leading the declines; while automobiles, coal, logistics and tourism strengthening.
News: (1) Meng Wei, spokesperson of the National Development and Reform Commission, said at a press conference on the 19th that in terms of effective investment, we will give full play to the role of the coordination mechanism for promoting effective investment in important projects, and take effective measures in accordance with the requirements of "funds and factors follow the projects", and take effective measures to improve the intensity and efficiency of factor guarantees, and accelerate the promotion of the first batch of policy development financial tools of 300 billion yuan to form physical work as soon as possible. At the same time, we will strive to make good use of the new policy development financial tools of more than 300 billion yuan, do a good job in project screening and recommendation, accelerate capital investment, urge local governments to seize the construction window period, and promote the start of construction as soon as possible. (2) Epidemic data shows that the number of new positives on September 18 decreased from the previous day, from 1,022 cases the previous day to 773, mainly due to the decline in the number of epidemics in Guizhou.
Afternoon follow:
(1) Restart 14-day reverse repurchase on Monday. The restart time is equivalent to the past two years and is in line with the seasonal rules. The purpose is to smooth out the capital fluctuations at the end of the quarter. However, in addition to seasonal factors such as tax payment, the fluctuations in the capital side may also be related to the increase in the demand for funds of the real economy in the context of macroeconomic improvement, which leads to a decline in interbank liquidity. If it is the latter, it means that the tightening of funds may be trendy, and this needs to be based on sufficient attention.
(2) In terms of risky assets, the stock market is still in the process of bottoming out, but from the perspective of valuation, it is almost approaching the extremely pessimistic stage in April, and the stock market may have limited room for further downward trend. Recently, we need to pay attention to the signal that the RMB exchange rate of is stabilizing. If it can be stabilized around 7, it may support risky assets.
Tang Jinzhang SAC: S0360622010001
Disclaimer
This article is published only for the purpose of investor education and does not constitute any investment advice. Investors should not replace their independent judgment with such information or make decisions based solely on this information. We strive to ensure the accuracy or reliability of the information in this column, but do not guarantee the accuracy or completeness of this information, nor do we bear any responsibility for any losses caused by the use of such information.
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