Lu Yuren – Asset Reinflation|Financial High Tea | Headline Daily

Rewrite this content In the Year of the Rabbit, the Hong Kong stock market resumed its rise for two consecutive days, closing at 22,688 points, and the Hang Seng Index rose by 644 points, rising for 6 consecutive weeks. The market took turns to speculate. Individual stocks such as SenseTime (020) soared 20% in a single day to close at 2.71 yuan. The market conditions are full of excitement.The global stock market has experienced a January effect. Hong Kong stocks have performed outstandingly, and U.S. stocks have also performed well. Last week, it was announced that the personal consumption expenditure (PCE) price index in December last year rose by 5% month-on-month, which was 0.5 percentage points lower than the previous month. The lowest since September, further reflecting the cooling of local inflation and strengthening market expectations that the Federal Reserve will further slow down the pace of interest rate hikes. The three major US stock indexes closed up. 33978 points, reflecting that the market is happy to see the slowdown in inflation and has concerns about the economic outlook. The Dow Index has risen for 6 trading days in a row; the index once approached 4100 points, closing at 4070 points, up 10 points; 109 points.The resumption of A-share market has become the focus of the marketFor the whole week, the three major indexes rose by 1.8%, 4.32% and 2.46% respectively. The ADR index of the Hong Kong stock market fell throughout the day, and closed at 22,608 points on a pro-rata basis, down 79 points. It is estimated that the focus will be on the resumption of the mainland A-share market next week.During the New Year, tea lovers in Central talked freely about the overall economic situation, and believed that the reopening of the mainland would have a driving effect on Hong Kong and even the global stock market. The stock market was ahead of the economy, driving the index to soar. Some tea lovers who have always been optimistic about the mainland economy believe that since the outbreak of the new crown pneumonia in 2020, the development of the mainland has been ups and downs, and it is generally operating under interference. Restarting the economy now is the driving force that has accumulated for three years, and I believe the rebound will be strong. He just came back from Hainan. During the Lunar New Year period, there were a lot of people. He heard that the business of the local duty-free shops surpassed that before the epidemic.Consumption boom in Hainan under unblocking effectWhat tea lovers say is not just a rumor. According to statistics provided by the Department of Commerce of Hainan Province on January 26, five days before the Chinese New Year holiday (Jan. 21 to 25) this year, the total sales of 12 outlying island duty-free shops in the province were 16.85. billion, an increase of 20% over the first five days of the Chinese New Year in 2022, and an increase of 325% over the first five days of the Chinese New Year in 2019. Hainan has expanded its domestic tourism market in recent years and opened up tax-free discounts for luxury goods. On the one hand, the figures reflect the effect of the policy becoming more mature, and also show that the mainland has relaxed epidemic prevention measures before the Lunar New Year. The big consumption day began to have a post-epidemic effect.The relaxation of epidemic prevention restrictions in the mainland this time was attributed to public pressure from the outside world. Tea lovers believe that it involved calculation considerations. The central government lifted the lockdown before the Lunar New Year, which has its own research and judgment on the lethality of the virus. It is controllable. After the holiday, the population returned to the city. I believe that the first wave of infections in the opening of the entire epidemic has been completed, and basically passed the first hurdle and passed the first test of returning to normal. From this perspective, it makes sense for Hong Kong stocks to open higher in the red market, let’s see how the A-share market resumes.Optimistic tea lovers analyzed the adjustment of the epidemic control policy and believed that the rise of the Hong Kong stock market was justified. Another big businessman with business in the mainland added another point of view, thinking that after the slowdown in the past three years in the mainland, it should be time to adjust the policy. From tightening to relaxing. He said that during this period of time, the central government has been vigorously rectifying private enterprises, and the two big sticks are hitting real estate and online platforms respectively. The former is the traditional economic pillar, and the latter is an emerging development engine. Stabilizing growth is naturally extremely difficult. At the end of last year, the central government began to adjust policies to relax the control of the property market and re-launch the platform economy; however, the impetus of the two has disappeared, and a catalyst is needed to restart it. One of the methods is to allow inflation to reappear in the mainland and stimulate it by releasing water. need.There are reasons to maintain growth under high interest rates in the United StatesBig businessmen said that the western economy will experience near-double-digit inflation in 2022. The prices in the mainland are relatively stable, and the renminbi is not open to the outside world. Even if inflation rises, there is no worry about capital outflow. Since the central government wants to restart the economy, why not release water floats? ?In the past two years, the mainland has been prudently regulating and controlling, and has repeatedly reiterated that it will not engage in flood irrigation. Big businessmen have invested in the mainland, and they may feel the pain of the economic slowdown. Therefore, they insist on heavy medicine. As for whether the central government will reverse the policy and release water, I believe that after the two sessions will be clear. However, from the perspective of global financial policies, although the West has vigorously raised interest rates to combat inflation, the stock and property markets have not yet fallen. The mainland economy is currently restarting. If momentum is regained and global growth resumes, a round of asset reflation cannot be ruled out.In 2022, under the impact of the war between Russia and Ukraine, Europe and the United States will experience sharp rises in energy prices and inflation, and the U.S. interest rate will rise to 4.5%. Calculated, if the growth rate is quite high in terms of currency value, the overall economic volume will not retreat but advance, and the range is quite large. If this economic volume is converted into the market value of the stock market, the market value that can be generated is quite considerable. The coexistence of growth and inflation in the United States last year was explained by the impetus for the post-epidemic rebound. The economic outlook for this year is not optimistic. However, due to the relatively high level of US interest rates, the Federal Reserve has some ammunition in hand to deal with it, causing a crisis in the US stock market. But it has not fallen, and what big investors are waiting for is for the central bank to cut interest rates and release water, and then promote asset expansion.SenseTime’s release reveals the mentality of foreign capitalCompared with the West, the mainland has undergone adjustments in the past two years, and the tone is relatively healthy. Especially when the United States is playing financial tricks through inflation, the mainland is more solid in promoting development from industrial adjustments. There are more means and tools to promote growth. If the mainland wants to Using the capital market to promote global competition, the conditions will not be inferior to those in the West, and the potential for asset re-expansion is greater. Therefore, since the fourth quarter of last year, foreign capital began to blow the wind of bullishness on mainland assets. According to foreign media citing high-frequency data from 21 countries tracked by the Institute of International Finance (IIF), emerging market stock and bond markets attracted net inflows of US$1.1 billion (approximately HK$8.58 billion) per day this week, the second fastest inflow. Post-coronavirus lockdowns lifted in late 2020 and early 2021 will exceed the peaks of the past 20 years.Of the US$1.1 billion…