Market reaction is nothing but the accumulation of many days to the release of panic

 Dongxing Securities Zhang Jingdong

view of this, the market's reaction is just the accumulation of many days to the release of panic. But the results, there is no substantial change in the phenomenon below the 2800 points have been frequent recently, but the broader market indicators before the shares are to support the market to reverse the action. When the first weekend, due to security considerations, the market shares give up a NT Powei given a chance, but nothing more. In the relatively abundant liquidity in the first quarter, taking into account the market value of the overall level of underestimation is difficult to support the broader market continued downward.

last week in Shanghai and Shenzhen stock tortured in the consolidation of transactions gradual decline, investors were caught in a painful wait. The reason is rumored to be the weekend to raise interest rates again, so finally the broader market on Friday once again below 2800 mark integer, form has become worse. But the end result is still somewhat surprising: the deposit reserve ratio increase. For the monetary policy surprise, the market has been a lingering fear, so since the New Year, despite repeated with the wishes of upside, but ultimately failed in the concern. The central bank has finally given the answer.



Although nowadays the Spring Festival is approaching, but investors are easy to distinguish the structural features of the current. Constitute a market decline is still the main driver of high valuation of breeds from the amendment, small plates, the GEM and the Main Board of the cumulative increase in consumer stocks are high down the main driving force. The remaining trading day before the Spring Festival is expected that this process will continue, but they impact the overall role of the market is weakening. We have always believed in the current stage, the chance to underestimate the value of the species from the amendment, including some varieties are the existence of such a large market opportunities, such as real estate, non-ferrous metals, coal, etc., that exist in other industries should underestimate the value of the species belong to the ranks. Of course, the banks can not because of some special factors included in this column. Thus, short-term decline in the broader market is in the process, the more obvious opportunities for bargain-hunting investors to pay attention.

Coincidentally, a year ago, also at the same time, the central bank raised the deposit reserve rate for the first time, opened a contraction of liquidity in the prologue. When the market is also immersed in the style of conversion eagerly looked forward to them, while the incremental bank credit is still abundant, it did not attract enough attention. But apparently a number of foresight from the funds to a different odor smell, began quietly to withdraw, which early last year, the Shanghai Composite Index has also led to a high point of the year. This time, the history of reproduction, it is natural that investors worry about the nightmare will repeat itself. However, we must see that this year, but this behavior contraction since the fourth quarter of last year extension of liquidity, which is expected to complete in the market, and even more moderate than expected, did not raise interest rates before the rumors of cash. In the current point in time, the central bank's move also has a special reason. First, in 2011 the central bank has already established the tone of prudent monetary policy, but many commercial banks, credit remains strong impulse; the second is a huge amount of notes due in early stage, to take hedging measures.