Mini Program: Daily Investment Bank/Institutional View Summary
Foreign
1. Deutsche Bank: OPEC+ may delay its production increase plan by three months.
Deutsche Bank research analyst states that OPEC+ is expected to further delay its production increase plan by at least three months, providing support for oil prices. OPEC+ has postponed its originally scheduled oil production policy meeting from Sunday to next Thursday. Analyst Barbara Lambrecht stated, "Schedule conflicts are considered one of the reasons, but there is also speculation about whether there are difficulties in formulating a joint production strategy, as has often been the case in the past." "However, we suspect this is more about disagreements over individual member country quotas rather than an overall strategy." Deutsche Bank expects that the alliance will choose to delay production cuts again; otherwise, the market will face a significant risk of oversupply next year.
2. Société Générale: The Federal Reserve's continued rate cuts lead to a decrease in short-term rates, while tariffs and fiscal deficits push up long-term rates.
Société Générale predicts that by the end of 2025, the 10-year U.S. Treasury yield will rise to 4.5%, while the 2-year U.S. Treasury yield will fall to 3.5%. The reason is that the Federal Reserve's continued rate cuts will lower short-term rates but will also stimulate demand for long-term government bonds through economic stimulus and increased fiscal deficits, leading to higher long-term yields. Additionally, Trump's tariff plan may raise inflation expectations, coupled with the U.S. government's expectation to increase the issuance of government bonds to address fiscal deficits, will also push up yields.
3. Scotiabank: The Canadian economy shows strong signs, suggesting that the central bank does not need to cut rates again significantly.
Scotiabank economist Derek Holt believes that although Canada's economic growth is slow, the details in the latest GDP report are much better than the headline figures, thus advising the Bank of Canada not to cut rates significantly again. Holt states that, in fact, the data shows that the degree of weakness in the Canadian economy is not as severe as previously expected, with a series of quarterly revisions showing that by the end of the second quarter, the Japanese economy grew by 1.45% more than previously expected. Most importantly, lower inventory accumulation severely dragged down growth in the third quarter, partly due to a rebound in consumer spending. Additionally, Holt points out, strong income growth coexists with a high savings rate. "There is no indication that the Bank of Canada should consider raising rates by 50 basis points in December."
4. Pansen Macro: The European Central Bank will temporarily remain cautious with a slight interest rate cut.
Pansen macroeconomists Claus Vistesen and Melanie Debono wrote in a report that the European Central Bank may not cut interest rates more significantly this month but will be prepared for further gradual rate cuts next year. Data released last week showed that inflation in the Eurozone rose in November, which may lead the European Central Bank to cut rates by 25 basis points in December, rather than 50 basis points. However, they stated that the bank's relatively moderate rate setters have increasingly persuasive reasons to support further rate cuts, and the bank may cut rates at least three times in the first half of 2025, with deposit rates potentially falling below 2% next year.
Domestic
1. CICC: The A-share market is expected to welcome the "year-end and beginning of the year market".
CICC's managing director and chief domestic strategy analyst Li Qiuxu stated in an interview that the nearly two-month "turbulence period" of A-shares may be coming to an end, and as the year-end policy important window period approaches, positive factors are expected to help A-shares usher in the "year-end and beginning of the year market"; at the industry level, it is recommended to layout in the booming growth industries based on fundamentals and in conjunction with a favorable supply-demand structure. (China Securities Golden Bull)
2. CICC: The Hang Seng Index at 19,000 points still has support, but external uncertainties limit the upward space of the index.
CICC strategy released a research report stating that, boosted by rising domestic policy expectations and the decline of U.S. Treasury rates and the U.S. dollar, Hong Kong stocks ended a significant correction over the previous two weeks last week. CICC strategy recently emphasized that the 19,000-point level of the Hang Seng Index is a key support level, and the market did indeed rebound after reaching this position. In the short term, the 19,000-point level still has support, but the upward space remains limited due to unresolved external uncertainties. Therefore, in the short term, the market is stuck in this position, with potential for both upward and downward movement. If domestic policies exceed expectations in the short term, the market may intermittently rise, but from the perspective of long-term "real constraints," it is suggested that investors partially take profits and shift towards structure in such cases. However, considering that overly strong policy expectations under "real constraints" are unrealistic, the strategy of "gradually positioning on the left side during a downturn, and moderately taking profits on the right side during excitement," while shifting towards structure, remains an effective strategy.
3. CITIC JianTou: The bull market in 2025 is expected to shift towards a "fundamental bull," and the short-term outlook is optimistic about the cross-year market.
CITIC JianTou's research report believes that the Chinese stock market is still optimistic about the "confidence reassessment bull market" from a mid-term perspective, and believes that as policies gradually intensify and take effect, the bull market in 2025 is expected to shift from a "liquidity bull" to a "fundamental bull." In the short term, it first looks forward to the cross-year market at the end of the year and early next year, leaning towards over-allocating several clues: asset reassessment: benefiting from financial real estate and debt reduction; new quality productive elastic assets, benefiting from the government's "two重" and "two新" types, service consumption and potential benefiting from the deepening theme of supply-side reform, etc.
4. CITIC Securities: Optimistic about the recovery opportunities in the global corporate IT hardware sector in 2025.
CITIC Securities research report indicates a positive outlook for the recovery opportunities in the global corporate IT hardware sector in 2025. It is expected that the main factors suppressing global corporate IT hardware spending in 2024 will significantly improve in 2025, including positive macro expectations, the elimination of policy uncertainties after the U.S. elections, and the opening of the Federal Reserve's interest rate reduction channel, all of which will help overall IT spending in Europe and the U.S. trend towards looseness. Additionally, the end of Window 10 EOL, the introduction of a new generation of server CPU platforms, and the depletion of inventory in enterprise network devices will also provide structural support in terms of sales. Coupled with further downward adjustments in market expectations after the third quarter reports, there are optimistic investment opportunities in the U.S. corporate IT hardware sector in 2025. In terms of priority, it is recommended to focus on: commercial PCs, AI servers, general servers, network devices, and enterprise storage sectors.
5. CITIC Securities: This special debt for state-owned enterprises has a distinct policy attribute and may mark the beginning of state-owned enterprises publicly assuming the function of stabilizing growth.
CITIC Securities research report indicates that this special debt for state-owned enterprises has a distinct policy attribute and may mark the beginning of state-owned enterprises publicly assuming the function of stabilizing growth. There has been a significant innovation in China's stabilization policy tools. State-owned enterprises have many high-yield projects, and leveraging state-owned enterprises does not easily create hidden debt problems, which helps align with the trend of new and old momentum conversion and alleviates the scarcity of high-quality local projects that drag on stabilization efficiency. A simple estimate shows that the potential scale of special debt for state-owned enterprises may be 4.1 trillion yuan. From the perspective of offsetting the impact of debt reduction on municipal investment with interest-bearing debt, it is expected to release over 1 trillion yuan in the coming year. Manufacturing investment, industrial added value, and actual GDP growth rate are the main benefiting indicators, but improvements in economic operation temperature still require coordinated efforts from demand-side policies.
6. Guotai Junan: Domestic expectations are likely to improve by year-end, and the Hong Kong stock configuration strategy is returning to internal certainty.
Guotai Junan points out that December's domestic policy thinking is clear, and market risk appetite is expected to improve, with expectations for improvements on the molecular end. External disturbances still revolve around long-term uncertainties, but domestic expectations are likely to improve by year-end, and the Hong Kong stock configuration strategy is returning to internal certainty. With fluctuations in U.S. Treasury rates and the stabilization of the RMB exchange rate by year-end, the Hong Kong stock cross-year market is expected to unfold, recommending high-dividend and domestic demand-related varieties for base configuration, while also paying attention to the rebound opportunities of quality growth stocks represented by the Hang Seng Technology Index: 1) Focus on flexible opportunities: Hong Kong Internet leaders and quality growth stocks with improving EPS, benefiting from domestic policy support, enhanced self-controllable capabilities, resilient profits, or economic recovery: including pharmaceuticals/electronics/automotive/new energy; 2) Benefiting from domestic demand support varieties: affordable consumption/home appliances; 3) In the stabilization phase of the exchange rate, recommend high-dividend base configurations, preferentially selecting for molecular end stability, while considering the benefits from mergers and acquisitions and debt reduction policies for central and state-owned enterprises, focusing on: finance/energy/telecommunications/materials/utilities, etc.
7. Huatai Securities: This round of the "cross-year market" may have certain foundations, but its sustainability faces tests.
Huatai Securities' research report believes that from the perspectives of fundamentals, liquidity, and policy expectations, this round of the "cross-year market" may have certain foundations: 1) Fundamentals: PMI has risen for three consecutive months and is stronger than seasonal expectations; the mid-cycle prosperity index tracked by Huatai Securities has also improved month-on-month; 2) Liquidity: The U.S. dollar index and U.S. Treasury yields have declined; premium income from insurance liabilities has rebounded year-on-year since the beginning of the year, and insurance funds and ETFs may provide incremental liquidity; 3) Policy expectations have risen ahead of the central economic work conference. However, sustainability faces tests: 1) The strength and effectiveness of policies still need to be verified, and the transmission of broad fiscal expansion to the credit cycle still takes time; 2) The potential negative impact of tariff policies may be repeatedly traded before Trump officially takes office; 3) The sustainability of the thematic profit-making effects and the warming of trading funds needs further observation.
8. Huatai Securities: Bank stock selection will gradually return to fundamental logic, enhancing the valuation premium space of quality banks.
Huatai Securities points out that a series of policies have recently been implemented to promote economic stability and improvement, and the interest rate reduction on non-bank interbank demand deposits helps improve the cost of bank liabilities, offsetting the downward pressure on interest margins and solidifying the foundation for stable performance. In the short term, the central government increases support for debt reduction, and some key regional banks benefiting from debt reduction are expected to see valuation recovery. In the medium to long term, steady economic recovery, improved risk appetite, and gradual return of bank stock selection to fundamental logic will enhance the valuation premium space of quality banks. Stock recommendations: 1) Short-term recommendations for stocks benefiting from debt reduction logic and expected improvement in asset quality; 2) Medium to long-term recommendations for high-quality regional banks; 3) The configuration value of stable dividend targets remains worthy of attention.
9. Caixin Securities: Improvement in the fundamentals will provide upward momentum for the market.
From the press conference of the "One Bank, One Bureau, One Committee" from September 24 to the end of November, the A-share market reversed the unilateral downward trend since May, and market confidence has significantly recovered, effectively boosting investor expectations. Recently, Yuan Chuang, general manager of the Research and Development Center of Caixin Securities, stated in an interview that all types of investors should have confidence in the subsequent trends of A-shares, but also a bit more patience, as improvements in fundamentals will provide upward momentum for the market. Yuan believes that in the long term, the strength of institutional investor development in China is increasing, and the trading proportion of institutional investors in the market will continue to rise, and the process of institutionalization of A-shares will continue to advance. Therefore, in the future, the market style dominated by institutions will become the norm. At the same time, various institutions need to continuously enhance their professional capabilities, adhere to the direction of fundamental research, value investment, and long-term investment, improve market recognition and credibility, continuously create value for investors, and become the ballast stone for the stable operation of China's capital market and support the development of the real economy and the appreciation of residents' wealth. (China Securities Journal)
10. Haitong Strategy: There are three aspects to closely monitor for the conditions to initiate the cross-year market.
Haitong Strategy released a research report indicating that there is often a performance window period at the end of the year and the beginning of the year, and with important meetings and institutional games, cross-year markets frequently occur, but the initiation time and magnitude of increases vary greatly. The conditions for the cross-year market to initiate are improvements in fundamentals/liquidity easing/policy catalysts, and the elasticity of the market depends on the strength of driving factors and the previous market environment. Currently, it is necessary to closely monitor incremental policies and fundamental trends, with a structural focus on technology manufacturing and mid-to-high-end manufacturing that dominates fundamentals in the medium term.
Article forwarded from: Jinshi Data