As May draws to a close, capital markets pay close attention to a number of major issues in June.

Among them, Shanghai issued an action plan to accelerate economic recovery and revitalization, involving eight aspects and 50 policy measures, which is one of the focal points.

Another focus is that the Fed officially launched a contraction on June 1st.

In addition, the rising commodity prices and food crisis caused by the conflict between Russia and Ukraine have affected the nerves of too many investors.

Specific to the A-share market, the market pays close attention to the upcoming Chinese economic data for May.

CICC said in the latest research report thatThe focus of the market has shifted from the previous policy warm wind and epidemic inflection point to pay more attention to whether fundamental stabilization can be confirmed, which may become the key to the market trend in the next stage.

CITIC pointed out in his report on May 29thStep into JuneAfter the epidemic has been effectively controlled, the package of policies to stabilize the economy is expected to be concentrated and effective, and the stage of the greatest pressure of overseas disturbance has passed and has begun to ease gradually.The main market for medium-term repair is approaching and is expected to continue to be characterized by slow rotation and will continue for several months.

1Shanghai fully resumes work and issues 50 new policies

On May 29, a press conference on epidemic prevention and control in Shanghai was announced.The whitelist system of resuming work and production of enterprises will be abolished from June 1, and the unreasonable restrictions on resuming work and production of enterprises will be abolished.

The Shanghai Municipal Action Plan for accelerating Economic recovery and Revitalization (hereinafter referred to as "the Plan") was announced on the 29th, according to the Securities Times. The "plan" has put forward eight aspects and 50 new policies to help enterprises bail out.

In view of the actual difficulties of enterprises, the plan proposes to comprehensively implement the policy of "slow exemption, reduction and subsidy" from the aspects of delaying the payment of "social insurance and house fund" and taxes in stages, expanding the scope of housing rent relief, reducing fees and profits for enterprises through various channels, increasing tax rebates and tax reductions, and granting subsidies for helping enterprises stabilize their posts, and so on.

In terms of tax rebates and subsidies, we will further strengthen the policy of VAT retention and deduction, and implement full VAT stock and incremental VAT rebates in more industries. one-time job stabilization subsidies will be given to enterprises in difficult industries such as catering, retail, tourism, transportation, sports and entertainment, accommodation, conferences and exhibitions, and one-time employment subsidies will be given to employers who meet the requirements.

In view of the blockage point of resumption of work and production, the plan proposes to abolish unreasonable restrictions on the resumption of work and return to the market, expand the scope of enterprise epidemic prevention and eliminate virus subsidies, establish a mutual insurance mechanism for the supply chain of the industrial chain in the Yangtze River Delta, and smooth domestic and international logistics and transport channels, and other policy measures to support the resumption of work and resumption of the market in various industries and sectors, and steadily increase the rate of enterprises to reach the goal. It is worth noting that the plan calls for the abolition of the white-name single system for enterprises to resume work and production from June 1.

In terms of stabilizing foreign investment, the plan calls for the establishment of a service mechanism for commissioners for the resumption of work and production in key foreign-funded enterprises, the use of an online service system for major foreign-funded projects, and the early launch of Shanghai to encourage the regional headquarters of multinational corporations to develop the application of special funds in 2022. We will further support multinational corporations to set up regional headquarters and foreign-funded R & D centers in Shanghai, and strive to stabilize the expectations and confidence of foreign-funded enterprises.

In terms of stabilizing foreign trade, we will increase support for export tax rebates and export credit insurance, encourage port and shipping enterprises to reduce or waive cargo storage fees and demurrage charges, and help foreign trade enterprises fulfill their orders.

In terms of promoting consumption, starting with bulk consumption, 40, 000 new non-commercial bus licenses were added during the year, and the purchase tax on some passenger cars was reduced periodically in accordance with the requirements of national policy. an one-time subsidy of 10000 yuan will be given to individual consumers who replace pure electric vehicles; support large-scale commercial enterprises and e-commerce platforms to issue consumption coupons, support the development of cultural innovation, tourism and sports industries, and vigorously promote the recovery of consumption. We will implement the trade-in program for home appliances, and appropriately subsidize the consumption of green smart home appliances, green building materials and energy-saving products in accordance with the regulations. Support large shopping malls, e-commerce platforms and other enterprises to carry out home appliances trade-in, green smart home appliances and electronic consumer products promotion and other activities by means of discounts and subsidies.

In terms of expanding investment, we strengthened the formulation of urban renewal planning, policy support and factor protection, completed the renovation of old areas in the central urban areas, comprehensively accelerated the transformation of sporadic old areas, and launched more than eight new renovation projects for urban villages during the year. We will spare no effort to promote the resumption of work and production of projects under construction and the commencement of new projects, support the expansion of the scale of corporate bond declaration and issuance, bring new infrastructure into the scope of local government special bonds support, give further play to the REITs role of infrastructure, and fully guide and stimulate social investment.

In addition, the program puts forward a number of supportive policies and measures around capital, land, talents, business environment and so on.

2The Federal Reserve starts shrinking the table.

The industry believes thatThe Fed's overall monetary policy shift is the biggest in the past 40 years.

According to the Fed's previous plan, a gradual contraction will be launched on June 1.

Its $8.5 trillion balance sheet will shrink and will no longer buy maturing Treasuries and institutional mortgage-backed securities, capped at $30 billion a month and $17.5 billion a month, respectively. From Sept. 1, the ceiling will be raised to $95 billion a month, including $60 billion for maturing US Treasuries and $35 billion for maturing institutional mortgage-backed securities.

Yang Yuting, chief economist of ANZ Greater China, was quoted by China Finance and Economics as saying that it is purely from the perspective of liquidity, as opposed to raising interest rates.The shrinking table has a greater impact, because this means to directly take away the liquidity.。

However, there is no direct impact on the currencies of the Asian region. Yang Yuting believes that interest rates and currency exchange rates are not as high as the shocks caused by the storm in 2013, so the impact on the market or the return of capital back to the United States is not as good as it was then.

As the Fed has made it clear that it will not actively consider raising interest rates by 75 points, dispelling market expectations that the Fed may further accelerate tightening, some industry insiders believe that risk appetite for technology growth stocks and energy inflation sectors may rise for some time to come.

Last week, all three major US stock indexes rose sharply, up more than 6 per cent. Both the S & P 500 and the NASDAQ broke seven consecutive weeks of declines, while the Dow Jones Industrial average had fallen for eight consecutive weeks.

Lower valuations attracted buyers after fears of a recession triggered a sharp sell-off. However, there are still investors who are sceptical about the continuation of the US stock market rally as inflation spirals and reaches painful levels.

3China's economic data for May will be released soon.

China's official manufacturing and non-manufacturing PMI for May will be released on May 31, and the May data are expected to pick up from the previous month as the domestic epidemic improves. The above data may become an important reference for investors to make next investment decisions.

For A shares, CICC said in its latest research report that after the rebound has been going on for some timeThe focus of the market has shifted from the previous policy warm wind and epidemic inflection point to pay more attention to whether fundamental stabilization can be confirmed, which may become the key to the market trend in the next stage.

For configurationCICC suggested that we should give priority to "stability" and first defend and then attack.We suggest that we should focus on three directions at present:

1) some areas of "steady growth" or with policy support: infrastructure (traditional infrastructure and some new infrastructure), building materials, automobile and housing-related industries have policy expectation or actual policy support

2) areas with low valuations and relatively low correlation with macro fluctuations, especially in some areas with high dividends, such as infrastructure, electricity and utilities, hydropower, etc.

3) some areas where fundamentals are bottoming out, supply is limited or the economy continues to improve: agriculture, some non-ferrous and some chemical sub-industries, coal, and photovoltaic and military industries.

CITIC pointed out in his report on May 29th that after the epidemic has been effectively controlled in June, the package of policies to stabilize the economy is expected to be concentrated and effective, and the stage of the greatest pressure of overseas disturbance has passed and has begun to ease gradually.The main market for medium-term repair is approaching and is expected to continue to be characterized by slow rotation and will continue for several months.

4The OPEC+ meeting will be held and the global food alarm will be sounded again.

In addition, capital markets are highly concerned about the tight supply of crude oil and food caused by the conflict between Russia and Ukraine.

The OPEC+ meeting will be held on Thursday, June 2nd, and the market is still expected to increase production moderately. And domestic finished oil prices will usher in a new price adjustment window; changes in the geographical situation and the United Nations Food and Agriculture Organization's monthly food price index are expected to have a certain impact on agricultural prices.

Thailand and Vietnam plan to jointly raise rice prices, a Thai government spokesman said on May 27, according to brokerage China. The Indian government is likely to tighten rice exports. India, Vietnam and Thailand are the top three countries in the world in terms of rice exports, accounting for 70% of the total.

According to CCTV news, the Russian Ministry of Agriculture said it did not intend to lift the export ban on sunflower seeds until the end of August 2022.

The conflict between Russia and Ukraine has intensified global food protectionism. since the outbreak of the conflict between Russia and Ukraine in late February, more than 20 countries have imposed restrictions and bans on grain exports, and major international grain markets such as wheat, corn and soybeans have continued to suffer turbulence, and the prices of related food products have been rising all the way.

According to data released by the International Food Policy Research Institute (IFPRI), as of May 28, including Argentina, India, Indonesia, Malaysia and TurkeyMore than 20 countries around the world have implemented restrictions on grain exports, including wheat, corn, flour, tomatoes, vegetable oil, beans and so on.