Rebirth of the Capital Legend

"'Consumer electronics' should be driven by the expected industry recovery in the second half of the year, and the expected hype of Apple's press conference in mid-September, right?" Song Shaopu, the main fund product manager of 'Hua Rui Performance Growth No. 9', who was standing next to Jia Yongxiang, responded, "The 'security lens' sub-sector should also be driven by the expected performance recovery in the second half of the year. As for the 'petrochemical' sector... it is really hard to understand why it can independently strengthen today, apart from the defensive main sectors such as liquor, white goods, medicine, consumption, and finance."

Previously, the petrochemical sector, especially the two oil giants, China National Petroleum Corporation and China Petrochemical, were the two core weighted stocks.

Basically, it is linked with a number of defensive main-line sectors such as liquor, white appliances, medicine, consumption, and finance, all of which fall within the scope of the market's defensive main-line sectors.

Today, the market's bullish sentiment generally warmed up and the speculative risk preference of on-site funds increased.

Obviously, it should be the defensive main-line sectors such as banking, insurance, liquor, white goods, petrochemicals, etc. that weakened and pulled back, releasing the trend of safe-haven funds.

However, the petrochemical sector suddenly broke away from the previous large group, strengthened independently, and formed a clear breakthrough trend.

This trend... is indeed a bit surprising.

"I never expected that the petrochemical sector would actually move in tandem with the weighted stocks in the consumer electronics and security lens sectors," said Jia Yongxiang. "I don't quite understand the motivations of the investors in these three main sectors.

Moreover, it seems that after these three main sectors have emerged.

The trend strength of the core theme of "big infrastructure" has decreased, and the desire for profit-taking of funds in the market and the actual selling pressure are also increasing.

Through this trend...

It can be clearly observed that several branch sectors suddenly emerged, including consumer electronics, security lenses, and petrochemicals.

The long-term funds group of the "big infrastructure" main line is already siphoning off the market liquidity.

Moreover, if the market continues to develop in this way, the overall market trend in the afternoon may show a late-day decline.

This makes it very difficult to predict the future market trend. "

"There is no way around it." Song Shaopu said, "The market expectations for 'big infrastructure' are too high, and the sentiment is too consistent. The funds deposited in it are becoming more and more mixed. In addition, many of the funds involved in the previous period, including institutional main funds, have become profit-taking plates, and there is a need to take profits and stop profits. Therefore, the trend is quite unsmooth, and the two branch sectors of consumer electronics and security lenses are the opposite.

Because the majority of investors in the market did not pay much attention to these two branches before.

And there aren't many expectations.

On the contrary, it was able to develop a market that exceeded expectations, and the underlying logic of these two branch sectors is not bad either.

As for the 'petrochemical' sector, I thought about it...I feel that it should be based on the expectation of recovery of industry fundamentals and repair of valuations, right?

After all, the nonferrous metal cyclical sector has already risen a lot from the bottom.

Whether compared with the defensive main-line sectors such as finance, consumption, liquor, and white goods, which are heavily supported by institutions, or compared with the real estate, construction decoration, building materials, nonferrous metals, steel, and coal sectors that have completed the first wave of increases, the overall valuation of the "petrochemical" sector is relatively underestimated compared with the expected future performance explosion.

I feel that there was a certain valuation bias in the market for the entire petrochemical sector.

Now, this should be considered a valuation correction.”

"I also feel that the chips in the 'big infrastructure' line are too mixed, there are already quite a few potential fund groups, expectations are too high, and emotions are too consistent, so it is difficult to move smoothly upward." Jia Yongxiang said, "If there is continuous buying, there will be institutions and other potential fund groups that will dump the market in large quantities, and then the investors who can't wait any longer will sell, and these funds that dump the market will quickly buy back the chips to cover their positions."

"That's right." Song Shaopu nodded and said, "So although the mid- to short-term market bottom is likely to be determined, even if the index is at this position, it is difficult to fall sharply, but as far as the trend of the 'big infrastructure' line is concerned, I'm afraid the adjustment is not over yet, and it will continue to fluctuate around this position for a while, so... we can't have high expectations for the 'big infrastructure' line at the moment.

At this time, all that matters is one word: endure.

See who can endure.

By driving away funds that lack patience and further concentrating the internal chip structure, a smooth market trend will naturally follow.

After all, the "big infrastructure" line is still the strongest in the market in terms of underlying logic.

Its main market trend is basically clear.

Relatively speaking, although the current trend of this core line will not be very smooth, the potential buying is still the strongest among all the main lines in the market.

That means the safety margin is the highest.”

"Do we need to increase or adjust our positions in the security lens, consumer electronics, and petrochemical sectors that have shown sustained strength?" Jia Yongxiang asked. "It seems that in the volatile market, the short-term explosive power and market height of the consumer electronics, security lens, and petrochemical sectors may be much stronger than the already clear 'big infrastructure' sector."

Song Shaopu thought for a moment and said, "There is definitely no suitable buying point for the main sectors of consumer electronics, security lenses, and petrochemicals today.

As for the follow-up, the market will shrink and stabilize after this wave of emotions is digested.

Then I think we can wait for the pullback of these major main lines and pick up some low-priced chips.

Of course, I think our core positions should continue to focus on the core theme of "big infrastructure".

Although this line is obvious, the positive driving forces from the news, policy and fundamentals are continuous. That is to say, after one wave of emotions is digested, another wave of emotions will soon follow, and the overall market trend may not be smooth.

After all, the volume of this line is too large.

To promote such a huge core theme, a lot of potential buying funds are needed.

However, I believe that local market opportunities will continue to exist, and the market will continue to speculate around the "big infrastructure" line.

Now, although there are related stocks in the field of "big infrastructure".

The differentiation in trends has already been reflected.

However, no matter whether it is the popular concept stocks in the market or the weighted stocks, the strongest ones are basically concentrated in the field of "big infrastructure".

And consumer electronics, security lenses, petrochemicals... these lines.

Although the short-term market trend and explosive power may be stronger than the "big infrastructure" line, in terms of sustainability and the depth of intervention of the main capital groups in the market.

That's far inferior.

In other words, the current investment safety margin is not as good as that of the "big infrastructure" line.

When the market buying is strong, these lines can move upward, but when the market buying turns weak, these lines can also move downward.

The current position of the "big infrastructure" line shows the depth of involvement of major funds.

There is basically no room to go down.

And as long as there is a downward correction, it will further siphon market liquidity, and the buying power will become stronger and stronger.

In the bear market, I think we should not only focus on offense when planning our investment strategy, but also consider defense issues.”

"Okay." Jia Yongxiang responded, feeling that Song Shaopu was right.

Indeed, the current macro trend of the market is not a bull market, but a bear market.

In a bear market, it is already difficult for the market index to develop a smooth and sustained rebound trend, coupled with the extremely heavy trapped chips in the market.

Once the market rebounds a little, selling pressure will emerge in an endless stream.

In this case, losing money is much easier than making money.

Therefore, defense becomes very important.

Just like the performance rankings of major funds in the industry in the first half of the year, many institutions that had performed well in the bull market had very poor performance after the market entered the bear market.

However, the performance of institutions that had previously performed better in defense was quite impressive in the first half of the year.

In other words, when the overall market is not good, what matters is not who has a better ability to make money, but who has a stronger defense and who can survive in the market.

Of course, facing certain investment opportunities.

You must also have the courage to take positions and the courage to transform a defensive strategy into an offensive strategy.

As the two discussed the current market trends and made subtle adjustments to the fund's investment strategy...

The market trading time at this time has entered 11:20, and there are less than 10 minutes left until the midday closing.

And in the last few minutes before the market closes at noon.

The trends and differentiation of the major market lines have become increasingly obvious.

Although the main industry sectors related to the core theme of "big infrastructure", such as real estate, building decoration, building materials, nonferrous metals, steel, coal, etc., still maintain the top position in the list of industry sector index growth in the two cities, they are no longer in the leading position, and the growth rate of related sector indexes has fallen significantly compared with the beginning of the trading session.

Instead, it was the petrochemical, consumer electronics, and security lens sectors that they had just discussed in detail.

It has become the market's leading sector.

Of course, the two major sectors of Internet software and film and television media, which were severely oversold, also performed well in the morning. The growth rate of the two major sector indexes remained above 2.5%, ranking behind the growth rate of a number of related industry sectors such as "big infrastructure", and it is also one of the strong performing sectors in the market.

As for the main sectors with defensive attributes such as liquor, white goods, medicine, consumption, and finance.

It still remains near the flat position.

There was neither a sharp drop due to the large number of sell orders in the market, nor a clear upward trend due to the improvement of the overall bullish sentiment in the market.

And other main market sectors and concept sectors.

There are also most of the small and medium-sized stocks in the market that do not receive much attention.

The trend basically fluctuates following the direction of the broader market. Of course, it follows more the fluctuations of the Shenzhen Index and the ChiNext Index.

Because in the first half of the year, the major weighted main-line sectors were tightly held by many core main institutions in the industry.

Also, due to the rescue of the market by the "national team" at the time, the core stocks of the major weighty sectors such as banking, insurance and electricity were pushed to too high positions.

The performance of the Shanghai Composite Index has been obviously distorted compared to the entire market.

Therefore, the general trend of individual stocks in the current market is no longer closely correlated with the Shanghai Composite Index.

After further evolution of the market situation, soon... 11:30 arrived and the two markets welcomed the midday closing moment.

It was just at the closing time at noon.

The Shanghai Composite Index was set to increase by 1.75%, while the Shenzhen Component Index and the ChiNext Index maintained an increase of more than 2%, significantly stronger than the Shanghai Composite Index.

Facing the situation of the two markets closing at noon...

At this time, the main hot money group of "Magic City Super Short Gang" is here.

Zhang, who was already fully invested in long positions, couldn't help but let out a breath and said with a smile, "Although the market trend began to diverge near noon, and the major main lines began to rise in rotation, but overall, today's market trend and volume performance are still relatively in line with expectations, and it can be said that it is doing well. It is particularly noteworthy that... Brother Chen, you mentioned the consumer electronics, security lenses, and 'petrochemical' sectors. Today, the early market trends of the various industry sectors and concept sectors related to 'big infrastructure' were too consistent, and the upward trend encountered certain resistance, but they actually came out."

"That's nothing strange." Brother Chen laughed. "The 'big infrastructure' line encountered selling pressure from the profit-taking yesterday and the day before yesterday. The funds cut high and low, looking for main line sectors with good subsequent performance and expected explosive power to cut into speculation, making a rotation of the main line, and further enhancing the market's money-making effect and market depth. This is completely understandable. However, I didn't expect the consumer electronics, security lens, and petrochemical sectors to rise so quickly. Logically speaking... these main line sectors should wait until the 'big infrastructure' line shows a clear downward trend in the market trend and the upward trend feels obviously struggling, and then gradually take over the potential buying of the high and low cuts to develop the market's money-making effect in depth."

"Isn't the trend of the 'big infrastructure' line this morning considered a divergence in the market?" Xu Qiao continued, "I feel that the active sell-off of the leading stocks in the 'big infrastructure' main line in the morning, releasing the selling pressure of profit-taking, can be considered as the digestion of the divergence in the market? I feel that the market trend in the afternoon... should be smoother than in the morning. After all, the selling pressure of profit-taking has been almost cleared in the market trend this morning."

"It's hard to say." Old Wu responded, "The overall bullish sentiment in the market is now fully sufficient after the guidance of Brother Su's large increase in positions. At least there is no problem in supporting the rebound of the market at this position, but the buying volume... I still feel that it is a little insufficient. After the opening of today, the volume in the first hour was quite satisfactory, but later... especially after the midday trading, along with the shrinking volume of the core main trend of "big infrastructure", the buying volume of the entire market has slowed down again, resulting in an obvious lack of active buying. If the active buying is insufficient, it will be difficult for the market to continue to break through!"