2021 Is Coming

Thoughts of the Week

On December 11, high-level meetings analyzed and studied economic work for 2021

Concisely summarized the magical 2020: My country became the only major economy in the world to achieve positive growth. It also expounded on the working methods: “In the face of severe challenges and major difficulties, we maintained strategic determination, accurately judged the situation, carefully planned and deployed, took decisive action, made arduous efforts, and delivered an answer sheet that satisfied the people and attracted worldwide attention.” It can be refined into a general working method and applied to all aspects of life and work: face up to the existence of difficulties, set strategic goals, assess the situation, formulate (adjust) tactical plans, take decisive action, do not give up until the goal is achieved, and complete the expected goal.
The short-term goal of poverty alleviation in the new era has been completed as scheduled, the phased goal of building a moderately prosperous society in an all-round way is in sight, and the long-term goal of the great rejuvenation of the Chinese nation has taken a new big step forward. Among the three critical battles (preventing and resolving major risks, targeted poverty alleviation, and pollution prevention and control), targeted poverty alleviation has been completed, and the remaining two tasks will become the main work in 2021. After vaccines are gradually listed in 2021, COVID-19 will no longer be the focus of work, and Sino-US relations are a long-term political and economic topic. Pollution prevention and control is still the focus of work. Specific work goals were revealed at the Climate Ambition Summit on the 12th:
By 2030,
- China’s carbon dioxide emissions per unit of GDP will drop by more than 65% compared with 2005
- The proportion of non-fossil energy in primary energy consumption will reach about 25%
- Forest stock volume will increase by 6 billion cubic meters compared with 2005
- The total installed capacity of wind power and solar power will reach more than 1.2 billion kilowatts

Concepts such as new energy, ecological restoration, and electric vehicles will continue to benefit from policies and achieve long-term development.

Next year is the closing year of the first “One Hundred Years” goal and the first year of the 14th Five-Year Plan. Everything must make progress while maintaining stability and consolidate existing results. It is clearly required to do a good job in resolving stock risks, resolving incremental risks, strengthening anti-monopoly and preventing the disorderly expansion of capital, and promoting the stable and healthy development of the real estate market. Combined with previous statements that “real estate is the biggest ‘gray rhino’ of financial risks at this stage” and “fintech is also finance”, it is clear at a glance which industries will usher in strong regulation next year.
Following “supply-side structural reform”, “demand-side” reform was newly proposed. “Double reform” and “double cycle” complement each other and will together become the main engine of economic growth in the future.

Events of the Week

People’s Daily commentary: Don’t just think about a few bundles of cabbage, the sea of stars of technological innovation is more exciting. After the hot spots of shopping, taxi hailing, and food delivery, selling vegetables has almost become another outlet for the Internet. Exerting efforts on the business of “splitting lean meat on heron’s legs” may be another wonderful story of the Internet changing lives through business model innovation. But there are also many different voices in the public opinion field. Not long ago, some Internet technology companies used cutting-edge technologies to solve scientific and technological problems, which deeply inspired us: the data and algorithms accumulated by the Internet, in addition to traffic monetization, have another way of opening, which is to promote technological innovation.

People expect giants not only to innovate in business models, but also to shoulder the responsibility of promoting technological innovation. If you only care about picking up sixpence with your head down, and cannot look up at the moon and unfold technological innovation that wins a long-term future, then no matter how much traffic and no matter how much data, it will be difficult to transform into hard-core scientific and technological achievements, and it will be difficult to change the passive situation of being controlled by others in core technologies.

Don’t just think about the traffic of a few bundles of cabbage and a few pounds of fruit. The sea of stars of technological innovation and the infinite possibilities of the future are actually more exciting.

@Guangyuan Kan Jingji: The Politburo meeting mentioned strengthening anti-monopoly and preventing the disorderly expansion of capital. The winter of Internet giants has come.

Market of the Week

Period: 2020-11-30——2020-12-06

As mentioned last week, when the valuation of pro-cycle weighted stocks is repaired, if the entire market maintains an upward pattern, Shanghai and Shenzhen will rise together. If the market remains volatile, it is difficult to grasp who is strong and who is weak. We must carefully select industries and individual stocks, and not pay too much attention to the rotation of the two markets. This week, the pro-cycle stalled, and vaccines, blood products, and aquatic products led the gains, while pro-cycle concepts such as carbon black, chemical raw materials, and automobiles led the declines. We still have to carefully select individual stocks to avoid the seesaw effect of industry rotation, use stillness to control movement, exchange time for space, and maintain stable returns.

Market (%)	Index	This Week	1 Week Ago	2 Weeks Ago	3 Weeks Ago
Shanghai Composite	3347.19	-0.77	1.06	0.91	2.04
Shenzhen Component	13555.14	-1.28	2.450	-1.17	0.71
ChiNext Index	2687.78	-1.13	4.7	-1.8	-1.47
Hang Seng Index	26505.87	0.36	-0.22	1.68	1.13
HSCEI	969.92	0.14	-1.71	2.49	-0.43
Hang Seng China-Affiliated	3667.94	0.39	-3.35	0.69	-1.21
Dow Jones	30046.37	0.16	1.03	1.45	-0.73
Nasdaq	12377.87	-0.23	2.12	2.53	0.22
S&P 500	3663.46	-0.13	1.67	1.58	-0.77

Market (CNY, Billions)	This Week	Last Week	2 Weeks Ago	3 Weeks Ago
Shanghai Connect	73.27	164.48	115.09	84.4
Shenzhen Connect	-3.67	80.92	7.51	-29.29
Hong Kong Connect	63.01	193.43	126.21	95.98

Positions

Type	Code	Name	Current Dynamics
Stock	SZ000889	Zhongjia Bochuang	New
Stock	SZ300766	Daily Interactive	Clear
Stock	LU	Lufax	Flat
Fund	F260104	Invesco Great Wall Domestic Demand Growth Mixed	Increase
Fund	F000566	Huatai-PineBridge Innovation Upgrade	Clear
Fund	F320022	Lion Fund Research Selected Stock	Clear
Fund	F001692	Southern National Policy Power Stock	Clear
Fund	F163415	Xingquan Commercial Front-end Fee	Clear
Fund	F001668	E Fund Global Internet Mixed	Increase
Fund	F519688	BOCOM Selected Mixed	Clear
Fund	F163406	Xingquan Herun Classified	Increase
Fund	F008238	Zhongtai CSI 300 Enhanced A	New
Fund	F166301	Huashang Trend Flexible	New
Fund	F004997	GF High-end Manufacturing	New