Chapter 233: Where is the next hot spot? (Breaking news: Thanks to Litong shareholders for the huge red envelope)
As people were chatting and laughing, the Shanghai Composite Index continued to climb upward. Strong cyclical sectors such as non-ferrous metals, kerosene and shipping began to rise and fall again like in the previous few days, while the rest of the sectors began to climb steadily.
In the VIP room, the noise of discussion gradually died down, and people began to pay attention to the trends of their own stocks.
Li Feng was busy discussing stocks with Xiao Bo, but he missed a lot of important financial information, so he took the opportunity to browse it.
First: China's CPI rose by 0.1% year-on-year in March, while the PPI fell by as much as 2.8% year-on-year.
For domestic investors, domestic CPI/PPI trend data is particularly important because it is the baton guiding upper-level policies and an important guide for our investments.
Especially the PPI data, from which we can observe the overall situation of the entire economy at a macro level.
The PPI data in March showed a month-on-month decline of 0.1 percentage points. As we all know, the PPI data will directly affect the CPI data, so a detailed study of the PPI data can indirectly give us a macro understanding of the overall CPI trend.
The data shows:
1. Among the major industries, prices in coal mining and washing industries fell by 15%.
my country has abundant coal and less oil, and coal is the cornerstone of domestic energy.
Therefore, coal prices can rise, but they cannot skyrocket. Therefore, in terms of performance elasticity, they are far inferior to oil, which is also an energy source.
It should be difficult to have a coal shortage or a short squeeze like in 2021. After all, in the past two years, a large number of coal mining companies have expanded production and exceeded production.
Second, the price of ferrous metals fell by 7.2%.
When it rains, it pours, and this is exactly what the steel industry is like.
On the one hand, international iron ore giants are monopolizing supply and driving up iron ore prices. On the other hand, the decline in the real estate industry is affecting demand. Furthermore, the automotive industry is moving towards lightweighting, with a large number of car bodies being made of aluminum instead of iron.
Life is not easy.
In addition, oil and gas, non-ferrous metals, and automobile manufacturing also lagged behind.
Overall, there is still deflationary pressure in my country at this stage, and it is even quite severe. Therefore, the monetary policy in the next few months should be optimistic and there should be no possibility of a shift.
(The stock market will not decrease, breathe a sigh of relief...)
Second: The wave of semi-solid-state batteries being installed in cars is coming; the sales of Toyota and Toyota both plummeted by more than 20% in China in the first quarter.
Nowadays, new energy vehicles have launched a dimensionality reduction attack on fuel vehicles.
What's more, in such a crazy internal competition market in China, new energy vehicles are about to soar to 50% of the new car market share.
The advantages of new energy vehicles are not only reflected in the cost of use, but more importantly, in the car computer. Some people jokingly say, "New energy vehicles are just mobile phones with four wheels."
Therefore, Japanese cars that still stick to fuel vehicles have fallen far behind in this industry transformation, and their demise is a foregone conclusion.
The automobile manufacturing industry is Japan's pillar industry. Japan was once the world's largest automobile exporter. Once its automobile industry collapses, the entire Japanese economy will collapse in an instant.
Directly shatter the halo surrounding Japan.
Article 3: Apple has increased its iPhone production in India, which now accounts for 14%.
From Samsung to Apple, they are gradually shifting their industrial chains away from China. The real factor behind this is the risk of decoupling between China and the United States.
Some time ago, the United States passed the Asian American Subdivision Act, the implication of which is self-evident: it is preparing for war.
And at this moment, there are still people going to the United States, which is really funny. They are the real people who joined the National Army in 1949, or even worse.
In the future, it is highly likely that Europe and the United States will close their trade doors to us.
Therefore, the direction of our business development should not only be Europe and the United States, but also the vast countries in Asia, Africa and Latin America.
Go out and curl outward.
People in developed countries are human beings; people in developing countries are also human beings, and they also need high-quality and low-priced goods.
Many people are worried that they will not be able to make money if they expand beyond Asia, Africa and Latin America.
In fact, this is a misunderstanding.
Doing business in Asia, Africa and Latin America is very profitable.
Take the domestic cement industry, which is extremely over-produced, for example. Conch Cement is considered a benchmark enterprise in China.
However, if you look at its annual K-line, it has been negative for five years.
The reason behind this is the sharp decline in demand in the real estate and construction industries, while domestic production capacity remains at 2.023 billion tons, which is a serious oversupply; not to mention the high coal prices and environmental pressure.
Opening its 2023 annual report, you can see that its operating income in 2023 was 140.999 billion yuan, a year-on-year increase of 6.80%, but its profit plummeted by 33.40% to only 10.430 billion yuan.
Looking at its products, the 32.5 grade cement with the highest gross profit margin only has a profit of 30.33%.
The leader has a hard time, and the younger brothers have an even harder time.
Two days ago, China Tianrui Cement, a leading cement enterprise in Henan and Liaoning and listed on the Hong Kong stock market and ranked eighth in national production capacity, saw its stock price plummet by 99%, returning to zero in an instant.
Some say that the company is insolvent, while others say it is a mortgage crisis.
There are many different opinions.
However, Western Cement, a cement company also listed on the Hong Kong stock market, has shown an unusual trend, having doubled in value in the past few months!
If we study its business scope further, we can find that its overseas business is simply a hen that lays golden eggs, and it lives a very comfortable life.
The profit margin of its projects in Ethiopia has reached over 50%, and the profit margin of its business in the Democratic Republic of the Congo has also exceeded 40%!
Against the backdrop of rising volume and price, its profits will naturally soar, resulting in a doubling of the market.
No one would have thought that cement, a sunset industry in China, would become a sunrise industry in Africa.
The same situation exists with Jinchengxin, a company that provides mining services overseas.
The gross profit margins of domestic companies such as Guangdong Hongda and Tongguan Mining and Construction are only 16.90% for the former and 13.48% for the latter, which can be said to be quite meager.
But its gross profit margin is around 26.5%.
It can be said that life is very comfortable.
Therefore, when Europe and the United States are about to close their trade doors to us and increase our trade risks, we can definitely enter the markets of Asian, African and Latin American countries.
It's still a blue ocean there.
With our infrastructure and manufacturing capabilities, we can fully support this and make it available to Asia, Africa and Latin America.
Going overseas is the next trend.
In the future, when this round of inflation cycle ends, it will be time to choose the next investment direction (one or two years later).
In addition to consumer stocks and bank stocks in the domestic market, we also need to pay attention to those companies that are working hard abroad and have seen both volume and price increases (almighty stock friends, do you have any relevant companies to recommend? I will prepare and research them a few years in advance).
(The business should be pure, and the volume and price should be increased)
While I was thinking, the market closed.
The Shanghai Composite Index closed at 3034.25 points, up 0.23%.
The non-ferrous metals sector rose in the morning session, but fell heavily again after lunch.
Leading stock Luoyang Molybdenum Co., Ltd. unexpectedly closed in the red, Zijin Mining also closed flat, Oriental Zirconium Co., Ltd. plummeted 7.93%, Jiangxi Copper Co., Ltd. also fell 3.14%, and other non-ferrous stocks also had a flat trend.
Among the strong cyclical sectors, only aluminum stocks, shipbuilding stocks, and COSCO Shipping Specialized are relatively strong.
It seems like another day wasted.
"Damn, another wasted day."
"I thought the market was booming, but it turns out I was just being sentimental."
"It seems that I underestimated the nature of A-shares. It's really like a pile of mud that can't be helped."
In the VIP room, a group of veteran investors left cursing.
Xiao Bo shook his head, feeling that today's trip seemed to be in vain, but also felt that it was not in vain.
Old Chen was very conflicted. He stared at the K-line charts of Luoyang Molybdenum and then China Heavy Industry, muttering to himself, "Oh no, oh no! Did I buy the wrong stock?"
"Look at the pattern of Luoyang Molybdenum Co., Ltd., it seems to be about to adjust. Look at the K-line trend of China Heavy Industry, it seems to be about to take off."
"I won't really become a leek, will I?"
He frowned, gritted his teeth, and for some reason, a trace of regret arose in his heart.
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