A shares have developed an independent trend!
Today, the Japanese and Korean stock markets fell sharply, but the A-share market was not affected much in the early trading, and it rose independently. The ChiNext Index rose by more than 2%, the Shanghai Composite Index and the Shenzhen Component Index rose by more than 1%, and the FTSE China A50 Index futures rose sharply, with an increase of more than 2%.
Although the Shanghai Composite Index plunged and turned green at one point during the session, the FTSE China A50 Index futures did not plunge. It is worth noting that foreign capital continued to pour in to buy at the bottom. Within more than 20 minutes of the opening, northbound funds had a net purchase of more than 10 billion yuan. In addition, the FTSE China A50 Index futures rose by 2.5%, breaking through 12,200 points.
Insurance, brewing, engineering machinery, railway infrastructure, special valuation, securities and other weighted sectors all strengthened. However, affected by the new delisting rules, nearly 60 ST stocks hit the limit down.
As of 10:30 a.m., the trading volume of the Shanghai and Shenzhen stock markets exceeded 500 billion yuan, an increase of 160 billion yuan from the previous trading day.
Foreign capital pours in to buy at the bottom
In the morning trading today, the A-share market was obviously stronger than the surrounding markets. Although there was a wave of diving during the trading session, the bottom-fishing action of funds was also very obvious, especially foreign capital, which increased its buying power during the diving process. At around 9:50, the net inflow of northbound funds exceeded 10 billion yuan, of which the net inflow of Shanghai Stock Connect exceeded 4.1 billion yuan and the net inflow of Shenzhen Stock Connect exceeded 5.8 billion yuan.
As of press time, the Shanghai Composite Index rose 1.16%, the ChiNext Index rose 2.24%, and the Shenzhen Component Index rose 1.53%. Liquor, insurance, coal, engineering machinery, railway infrastructure and other heavyweight sectors have collectively strengthened. Currently, among the A-share companies with a total market value of over 300 billion, only Zijin Mining is in the red, Wuliangye rose 5%, China Mobile and Kweichow Moutai both rose more than 2%. Gold, tourism, hotels and restaurants and other sectors that were strong in the early stage have collectively adjusted.
Big financial concepts also fluctuated higher, Jianyuan Trust hit the daily limit, Shouchuang Securities hit the daily limit, CITIC Bank, COFCO Capital, PICC, China Life and others followed suit.
On April 12, the State Council issued the "Several Opinions on Strengthening Supervision, Preventing Risks and Promoting High-Quality Development of the Capital Market", which is the third "National Nine Articles" for the capital market and the "1" in this round of the "1+N" policy system for the capital market. The release of the "National Nine Articles" has aroused the emotions of many investors. Throughout the weekend, everyone is looking forward to the opening of A-shares on Monday this week.
CITIC Securities believes that with the release of the new "National Nine Articles", the framework of the new round of capital market "1+N" policy system has gradually become clear, focusing on strengthening supervision, preventing risks, and promoting high-quality development, pointing out a new blueprint for the development of my country's capital market in the medium and long term. Compared with the previous two "National Nine Articles", the core of this opinion is to adhere to the political and people-oriented nature of capital market work, to serve the country's major strategies and promote high-quality economic development, and to practice finance for the people and protect the rights and interests of investors. Specifically, the opinions put forward a number of measures on the "one in and one out" of the capital market, supervision of listed companies, construction of investment institutions, entry of medium and long-term funds into the market, and prevention and mitigation of risks.
CITIC Securities said that the implementation of the new "Nine National Policies" has laid an important foundation for the healthy development of China's capital market in the medium and long term. Whether from the perspective of short-term or medium- and long-term investment, the strategic allocation value of dividend strategies is increasing. The framework of the new round of capital market "1+N" policy system has gradually become clear, and the focus of reform has shifted to the investment side, focusing on improving the quality of listed companies and investor returns, laying an important foundation for the healthy development of China's capital market in the medium and long term. In the short term, the policy is more conducive to the market style and dividend strategy.
Bocom International Securities also believes that the high dividend strategy is expected to continue further, and the attractiveness of equity assets will be further enhanced, which will help attract fixed-income driven funds and residents' funds to enter the market. The "National Nine Articles" mentioned the relevant guidelines of the dividend policy many times, such as clarifying that "the dividend policy must be disclosed when listing" and "strengthening the supervision of cash dividends of listed companies. For companies that have not paid dividends for many years or have a low dividend ratio, restrict major shareholders from reducing their holdings and implement risk warnings. Increase incentives for high-quality dividend companies and take multiple measures to promote the increase of dividend yields. Enhance the stability, sustainability and predictability of dividends, and promote multiple dividends, pre-dividends and dividends before the Spring Festival in a year." This will undoubtedly directly promote the increase of dividends of listed companies, and then drive the recovery of dividend yields. Considering the background of the continued decline in the central interest rate, the current A-share dividend rate, taking the Shanghai and Shenzhen 300 as an example, has rarely exceeded the 10-year treasury bond yield in the same period. From the perspective of long-term fixed income, index dividends are already very attractive, and increasing dividends will undoubtedly further enhance the attractiveness of equity assets. This also provides the most direct catalyst for promoting fixed-income driven funds such as bank wealth management and trusts to increase equity market allocation, and will also help further tilt the residents' asset allocation structure towards equity assets.
“Junk stocks” are abandoned
"Junk stocks" collectively plummeted. As of press time, nearly 60 ST stocks, including ST Hong Taiyang, ST Meixun, ST Zhongzhu, and ST Tiancheng, hit the daily limit, and another 15 ST stocks fell by more than 5%.
On the news front, the China Securities Regulatory Commission issued the "Opinions on Strictly Implementing the Delisting System" on April 12. Guo Ruiming, Director of the Listing Department of the China Securities Regulatory Commission, said: "This reform has lowered the number of years, amount and proportion of financial fraud that triggers delisting, and adjusted the existing indicators of fraud of more than 500 million yuan and more than 50% for two consecutive years to more than 200 million yuan and more than 30% for one year, 300 million yuan and more than 20% for two years, and fraud for three consecutive years or more. The purpose is to effectively curb financial fraud."
Information from the China Securities Regulatory Commission shows that the new delisting rules focus on five aspects: strictly enforcing delisting standards, unblocking multiple delisting channels, reducing the value of "shell" resources, strengthening delisting supervision, and implementing compensation and relief for delisted investors.
In terms of strict mandatory delisting standards, the new delisting regulations will include long-term use of funds that leads to "hollowing out" of assets, years of continuous non-standard internal control opinions, and disorderly struggle for control that prevents investors from obtaining valid information about listed companies as standardized delisting situations; increase the delisting indicators of operating income for loss-making companies, and increase the delisting efforts for companies with poor performance; and improve market value standards and other trading-related delisting indicators.
In terms of reducing the value of "shell" resources, the new delisting rules strengthen the supervision of mergers and acquisitions, strengthen the relevance of the main business, and strengthen the supervision of "backdoor listing"; strengthen the supervision of acquisitions, tighten the responsibility of intermediary institutions, and standardize the transaction of control rights; severely crack down on illegal and irregular activities behind "shell speculation"; and resolutely clear out listed companies that have no restructuring value.
