Category: Money Tips Date: 2006-01-12
Source: Guangzhou Bandung
Abstract: From May 10, 15 consecutive two editorials to the Xinhua News Agency issued new shares to accelerate, we can see, in fact, everything in the management of the "premeditated" at home. From the current point of view, the management indeed excessive and irrational fear of stock market bubbles rise and accumulate capital market reforms will bring new risks, so take a series of measures to stabilize the market trend.
Related media reports, informed sources, the central leadership, said recently: I am pleased to see the stock market rally, do not want to see the stock market fell, but do not want to stock up too fast. In the second half, the Central will continue to encourage the development of capital markets, the overall trend in the stock market up, but not too fast; to enhance investor confidence and attract more investors to join, but to control the market rhythm. In addition, the central government decided to reduce the quality enterprises to go listed overseas, encouraging those that have listed overseas companies to issue A shares.
From May 10, 15 consecutive two editorials to the Xinhua News Agency issued new shares to accelerate, we can see, in fact, everything in the management of the "premeditated" at home. From the current point of view, the management indeed excessive and irrational fear of stock market bubbles rise and accumulate capital market reforms will bring new risks, so take a series of measures to stabilize the market trend.
First, the basis of the bull market is not solid, fast rise will trigger a new crisis
Full Circulation Reform Although the core of the market mechanism to solve the problem, but this does not mean that the market all the problems solved. In fact, with a complete change in shareholding structure, the market the emergence of new risks. Renmin University of China Institute of Finance and Securities Wu Xiaoqiu, said: In the tradable era, only the controlling shareholders will become the main body of market manipulation, which could lead to greater harm. We have split share structure reform introduced a number of policies, allowing controlling shareholders to increase its stake in due course. From the system design point of view, this has left room for market manipulation. Therefore, the need for law to regulate and improve, which is to pay attention to regulatory authorities.
In addition, the governance structure of listed companies, insider control, and false information disclosure of listed companies directly involved in the quality and integrity of the mechanism are still not fully resolved. In such an environment, the development of management on the one hand the need to solve the problem, but on the other hand, non-rational rose too often will help the further deterioration of the above questions Zhang, while increasing the cost of solving the problem is not conducive to the management of for the entire market reforms.
From this point, the institutional basis for the bull market is still not strong when the excessive fanaticism and increase the market can only become an unbearable weight, but also the management do not want to see.
Second, the market frenzy atmosphere could lead IPO bubble
Management, issuance of new shares, in particular the release of several large carrier market was intended to inject new assets, the stable development of the future for the market to build a better foundation. However, the irrational rise in the market when issuing new shares not only not be able to play such a role, they may generate more foam, which is management by fear.
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China International to become the first IPO from a single start and there are more than 30 new stock issues, and then there will be more than 100 new shares pending. But if market sentiment does not cool down, mad cow can not be effectively brought under control the issuance of this size is like to put a float in a pot of boiling water, cold water, and its role only temporarily delay the whole pot of boiling water, just practice, however, finally boiling water more, and more difficult rehabilitation. Look at from 1996 to 2001 bull market, often the most enthusiastic when the market appears rampant speculation the new phenomenon.
If the continuation of the previous situation, in the mad cow catalyst, once the location of new shares is too high, the bubble too much, apparently the healthy development of the whole market will remain endless troubles, will further affect the progress of market reforms.
Third, the management of multi-pronged approach to suppress speculation in the atmosphere
Based on the above two reasons, the management can no longer turn a blind eye, and in the mainstream of state-owned fund of funds based basically completed the withdrawal of hot money, when active, management heavy attack, began to purge the market. Speed up the issuance of new shares, inventory illegal funds compression market funds face is the management of the two main measures taken.
Notes the recent inter-bank market, the unusual situation of a row, management attention, allegedly has begun to check illegal entry from the bank bill market funds. At the same time the surface, the central bank has repeatedly said there are no more recent tightening of monetary policy introduced, but another one, the market interest rates gradually higher, long-term bonds as no one is interested in the object, this just shows subtle changes in surface of funds and mainstream agencies judgments of the management's intentions.
IPO context, the issue of new shares at an unprecedented pace, the first step in the new aging off to the third step took just less than a month. Small plate stock issue onwards, to the carrier by the end of June the Bank of China may release, in the middle of the time less than a month. Regain market financing function can be described as a policy does not upset the pace of issuance of the accelerating trend is also very obvious. Moreover, from now I would go and wait it will produce 130 listed companies, the management has have to speed up the weight distribution, such as in the Shanghai Stock Exchange have been doing a one-day arrangements for a release preparations.
The management of a two-pronged objective is to quickly heat up the market to pouring a pot of cold water to non-rational speculation a needle refreshment.
4, the market is still wide shock will be the main
However, we believe that management would not to really pressure the stock market, but in order to stabilize the market, squeezing the bubble. Given the current overall position still more reasonable price, the market price-earnings ratio remains at nearly 20 times the space, the market's downside is not yet a big one. Therefore, the market will maintain a temporary shock consolidation pattern, investors should focus on in the stock price shock in the process of differentiation process, while bargain-hunting strategy takes a high throw to get the maximum benefit.
In addition, as we have emphasized, the longer term, monetary liquidity contraction is the bull market of the real "killer", the market is now entering a high-risk areas, should begin to lighten up a strategic consideration.
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