18 August, Shanghai and Shenzhen stock markets after the sharp rise in the early, had a substantial adjustment. Shanghai declined 3.76%, szse composite index dropped 3.38%. Market what is significantly decreased causes is adjusted or peaked? how would after market evolution? this article on this analysis.
Local unit decrease in far index
18 market significantly reduced set this year's largest decline. Shanghai declined 3.76%, szse composite index dropped 3.38%. Decline in the market as a whole, the Shanghai and Shenzhen stock market 1365 home A share companies have decreased, 1202 home only 107 home prices.
Statistics stock rise can be found, G unit by 1.6%, far less than the market average. ST company decline less than the market average, average 1.67% decline. * ST company only 0.56% decline. In 107 home prices in the company, the company has 12 ST, * ST company has 17. On the contrary, the Shanghai local unit by 5.17%, far greater than the market average. You can view, Shanghai local shares on the market made a great contribution to the callback.
Excessive speculation overdraft quotes
This decline is largely part of the unit into expected stock market for excessive speculation overdrawn.
June 19, the second batch of pilot company after the publication of the list, along with the share-trading reform further advance, at all levels of Government also actively support the share-trading reform, steel shares, shares in electricity, the Yangtze River, and a number of shenneng large panlan chip companies published a comparison of the price of the programme. Investors on the unit by the suspect to identity, found that the share-trading reform in circulation shareholders can obtain higher on prices, investors ' equity division reform have positive expectations.
Investors ' positive expected not only to pilot a sharp rise in the company's stock, the expected stock price unit into company also rose considerably. It was reported that Shanghai State sector organizations devoted to the study group on State-owned shares of listed companies has conducted a comprehensive mapping, and from more than 130 requires unit into companies selected by 20 Shanghai local company as fully pushed open the share-trading reform spearheads. Due to the Government to promote and support, Shanghai local unit as the most popular in the early gathering of one of the plates, or impressive. According to statistics, since 17 July to 17 August, Shanghai local unit of the average increase was 38 per cent, more than 20 percentage points higher than the market, a considerable part of the company exceeds 50%, and even some companies exceeds 100 per cent.
However, the listed company shares to the shareholders is in circulation to the amount of the consideration obtained for the price range of buildings with stock price rise is to be further discussed. Statistics 46 pilot company unit into consideration, would be sent now, warrants, etc are sent fold synthesis, whose average unit sent stock level is 10 send 3.37, sending shares highest G wuhua, only 10 G Hongsheng also sent 5 unit. Considering the pilot Corporation is the normal operation of the company, 10 3 or so should be sent to this type of company, a more reasonable price levels. Exceeds 50 per cent of the company if the normal operation, the level of price Stock reform generally does not exceed 10 to 5, excessive overdraft unit into the inevitable attracted investors expected profit satisfaction, promoting market callback. In addition, the unit into effect declined further contributed to the market's callback. 18-resumption of Baosteel, calculated according to the stock before the suspension, taking into account the value of the warrants (by 0.63 element calculation), investors profit from before and after ex-dividend is 10%, far below the initial level of the pilot Corporation's profitability.
Secondly, the market for new and old are broken, refinancing, and expansion of fear aggravated market callback. With the second batch of equity division reform is coming to an end, investors back and think of new and old Division of fault, refinancing, etc. Although the expansion can help increase the quality of the investment company's scale, but because of the ever expanding shunt funds will enable the market decline, investors in inertial thinking, often on a psychological horror expansion, when the stock started callback overdraft, to the expansion of fear further exacerbated the market's decline.
Rationally to price and volume expansion
In the first company to begin seeking equity division reform programmes, at first circulation shareholders and non-negotiable shareholders on the question of history have different understanding, if not consensus, circulation shareholders that elect to vote on price feet lower than the expected spot market has become the most important factor in the decline. When the second group of companies consult programmes, market sentiment and entered another extreme, many investors are reset when the commitment of the various criteria value investment in defiance, keen to discuss how to price and the price potential, will risk control throws to the brain, the market seems to go back to the old fool. We believe that the price as this unit into the core concepts of, and investors should not be empty and digitization, and in particular that ignored the company fundamentals, blindly to the amount of the price of an investment based solely on the criterion of inadequate intake, but the price factor in the company's fundamentals are comprehensive consideration, thus making investment choices in a rational manner.
It cannot be denied that ephemeral Madness cannot cover up the market and weak long bear market mentality, financing as a normal market the function also repeatedly being negative. But investors need to understand, to the present stock of profit structure, its periodicity is very obvious (about 1/2 strength). This kind of structure on economic or trade cycle very sensitive: in the current context, when economic or trade cycle economy downturn, recurring profit decline faster total, market valuation level of dynamic will again quickly uplift, thus spoiling the whole market. Therefore, as soon as possible to introduce some cyclical not obvious or service class large blue-chip company's initiatives is the optimization market structure, reduce cycle impact and the need for stable long-term market initiatives.
Should adhere to the fundamental
Signs, China's capital markets have been walking in an increasingly healthy and productive efficiency on track, but also some historical issues, in particular, the gradual elimination of nearly 2/3 of the circulation of shares does not alter the situation.
Continuous stock reform of the accounting effects arising (actual earnings of static reduction) will be in for quite a long time the cyclical factors likely to hedge against the adverse impact of the market, thus contributing to the development of China's capital market gain valuable time. But at this moment, we should adhere to the investment concept based on the fundamentals, which is the unit into future valuation level is the evaluation of the value of the company, in particular, the key criterion for some excellent blue chip companies have exhibited high interest bond debt, more worthy of attention, but investors investing in stock reform for cyclical company, indeed plays a role in accelerating the time base.
In addition, investors should not abandon the unit into process might exist in all types of risk-free investment opportunities, such as non-negotiable commitment to repurchase the shareholders under the terms of brewing investment opportunities.
This version of author statement: in this body, to my knowledge, this body, I as well as the property of the interested person and the evaluation of securities not interested.
This article is purely a personal point of view, is for informational purposes only, what he writes. Readers accordingly into the city, at your own risk.
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