In July, it is suggested to layout value stocks in technology, electrical utilities, military industry, and non-ferrous metal sectors. Product structure, 10-30 billion yuan products operating income of 401/1288/60 million yuan respectively.
Galaxy Securities released a research report on the change in market style and fund preference. It is expected that market sentiment will still be the main factor affecting market trends in July. The further rise in market risk appetite needs to wait for new catalysts. The key point that mainly affects sentiment is changes in policy intensity and rhythm. Pay close attention to the upcoming Third Plenary Session of the Twentieth Central Committee. Investment strategies for July should focus on undervalued value stocks and growth value stocks in sectors that benefit from policy expectations. The bank recommends the strategic layout of value stocks in technology, electrical utilities, military industry, and non-ferrous metal sectors.
Galaxy Securities' top 10 gold stocks in July are: Hengtong Optic-electric (600487.SH), GigaDevice Semiconductor Inc. (603986.SH), Sichuan Chuantou Energy Co., Ltd. (600674.SH), Zhongjin Gold Corp.,Ltd (000489.SZ), Beijing Roborock Technology Co., Ltd. (688169.SH), Ningxia Baofeng Energy Group Co., Ltd. (600989.SH), China Construction Bank Corporation (601939.SH), China Shenhua Energy Company Limited (601088.SH), CRRC Corporation Limited (601766.SH).
Galaxy Securities' viewpoint is as follows:
In June 2024, the market continues to oscillate and adjust.
In June 2024, market volatility intensified, and investor sentiment is more cautious. As of June 27th, the Shanghai Composite Index fell by 4.57%, the Shenzhen Component Index fell by 5.50%, and the CHINEXT Price Index fell by 5.65%. In terms of sectors, the performance of the communication and electronics sectors was relatively stable, while real estate and commercial retail suffered larger drops. The net outflow of northbound funds in this month was RMB 49.394 billion.
The economic operation is stable, and the endogenous momentum continues to accumulate.
In May, China's economic operation was generally stable, and exports maintained good growth, while consumption accelerated. In May, the total import and export value of goods was RMB 3.7077 trillion, a year-on-year increase of 8.6%. Among them, exports were RMB 2.1471 trillion, an increase of 11.2%; imports were RMB 1.5607 trillion, an increase of 5.2%. In May, the total retail sales of consumer goods were RMB 3.9211 trillion, a year-on-year increase of 3.7%, and the growth rate of consumption rebounded. From January to May, investment in high-tech industries increased by 11.5% year-on-year, with investment in electronics and communication equipment manufacturing industry increasing by 10.4%. Technological innovation continues to lead high-quality development, and new production forces continue to grow. Overall, exports are still the more certain factor in current economic growth. Although domestic demand data is relatively weak, with the landing of local consumption policies, domestic demand data is expected to improve. On the policy side, the STAR Market has once again ushered in important policy reform measures. The release of the "Eight Measures for the STAR Market" will open up new space for the capital markets to serve new production forces and continue to accumulate endogenous momentum.
In July, the market is expected to oscillate and consolidate new opportunities.
Galaxy Securities' viewpoint is that the current market style is switching, and fund preferences are changing. It is expected that market sentiment will still be the main factor affecting market trends in July. The further rise in market risk appetite needs to wait for new catalysts. The key point that mainly affects sentiment is changes in policy intensity and rhythm. Pay close attention to the upcoming Third Plenary Session of the Twentieth Central Committee. After a continuous oscillation and adjustment in June, the overall market environment in July will be relatively better. It is expected that the market will still be dominated by shock, and the differentiation between sectors will continue to intensify. New investment opportunities are expected to emerge in this process. It is recommended to focus on high-quality leading stocks. Investment strategies for July should focus on undervalued value stocks and growth value stocks in sectors that benefit from policy expectations. The bank recommends the strategic layout of value stocks in technology, electrical utilities, military industry, and non-ferrous metal sectors.
Risk Warning: 1) The risk of overseas monetary policy being tighter than expected; 2) The risk of global economic recession exceeding expectations; 3) The risk of being affected by geopolitical conflicts.