Haitong Securities Institute Director Wang Yiming: Second half beware of medium-term adjustment

Every reporter Jiang Yanyan July 16, the National Bureau of Statistics released the first half of the 2009 economic data, the first half of the situation that the annual coverage of 8 of GDP tasks will not be frustrated.　　And, the number of power generation from negative positive, PMI data continued to good and small and moderate growth, new projects are still speeding up the start and so on, so that the market really feel the economic stability and there are signs of recovery. But while positive data is on the rise, we should also see most of the good data showing up in government investment, and a further fall in PPI and CPI data means more deflationary pressures. Will the decline in export data lead to pressure on economic growth to be sustained by investing in a "single engine" to pull the economy?　　Wang Yiming, director of the Haitong Securities Institute, received an interview with the Daily Economic News (NBD) yesterday that the economy would continue to improve in the second half of the year, but that the stock market would not necessarily continue to move higher or even exclude the possibility of medium-term adjustment.　　Macroeconomics continues to be bullish NBD: in Thursday, the Bureau of Statistics released various statistical figures, how do you judge the economic situation in the second half of the year?　　Wang Yiming: We continue to be bullish on China's economy in the second half of 2009, and we have made a projection that the GDP growth rate will exceed 8% in 2009 and the growth rate is 8.3~8.5%. There are three reasons to come to this conclusion: first, the rebound in demand and the base factor to increase the value of industrial growth continues to rise, and because of the inventory effect, industrial production fluctuations than demand, coupled with the decline in the base last year, we believe that the second half of industrial growth rate will be more than 12% or even higher　　Second, the growth rate of government projects will slow down in the second half of the year, and real estate investment will take place, we expect 2009 growth of fixed assets investment will reach 34.5%; third, the total retail sales of consumer goods will continue to maintain steady growth in the second half of 2009. At present, the external economic recovery is still not obvious signs, and this year, China's economic growth is mainly driven by the increase in investment growth, export by the external demand for greater impact, short-term will not be significantly improved. We expect 2009 export and import growth of 12.9%, 15.7% respectively. Deflationary pressures eased in the second half of the year, since November 2009 CPI growth has been positive, the annual CPI rose-0.5%. While the PPI continues to slide, we believe that the situation is likely to change in July, with a narrowing in August.　　In addition, the base period to achieve positive year-end PPI growth, November 2008 began a sharp decline in PPI, the elimination of the end of 2009 PPI to achieve positive growth is very likely.　　A-share or medium-term adjustment NBD: Haitong Securities in the middle of this year's medium-term strategy, the future of China's macro-economic growth there are two risk, so the second half of the expected a-share or the medium-term adjustment pattern, to make such a judgment of what is the market and how defenseWang Yiming: We believe that in the second half of this year a-share market may enter the medium-term adjustment pattern, but the adjustment will be significantly different from the 2008 market adjustment, that is, its adjustment to a greater extent should be time adjustment, and the adjustment should be much smaller than the 2008 market adjustments. Then, may cause the second half of this year, the main elements of the medium-term adjustment include: first, in the fourth quarter of this year, China's CPI is expected to "from negative positive", real estate and other asset prices "bubble" exists, for monetary policy adjustment provides conditions and factors to promote;　　The market may have a consensus expectation of two times of China's economic growth in 2010; third, from the point of view of capital supply and demand, factor money supply growth in the high position, the increase in capital supply may already be in the top region, which means that the second half of the market capital supply and demand there is a potential　　Therefore, in the operation of the proposed investors through appropriate adjustment industry allocation strategy, moderately reduce the offensive industry allocation ratio, and increase the defensive industry allocation ratio.　　NBD: Some analysts believe that as the first half of the recovery is the result of liquidity support, does it mean that as long as the liquidity does not change the stock market will not happen big changes?　　Wang Yiming: Liquidity is always relative, but if the second half of the credit and money supply continue to exceed expectations, it may make the current a-share market "structural bubble" pattern continues.　　NBD: At present, the overseas market frequently appears the financial institution performance to be good, the big enterprise performance turns good news, and stimulates the recent overseas stock market to rise, this will support the domestic market to walk well?　　Wang Yiming: If the overseas stock market is in a strong position, it should produce favorable stimulation to the periodic trend of the A-share market.　　NBD: The evaluation of the second half of the market, most brokerages bullish on the financial, real estate sector, while your main launch of the new energy, regional economic sector, can you explain why? Wang Yiming: Financial stocks and real estate stocks in the early days of the rise, to a large extent, to benefit from the real estate industry policy aspects of loose, credit scale blowout and other factors, given the possibility of future policy adjustments, and next year, China's economic growth rate of two times drop pressure, so, in view of the cautious point of view, we do not recommend finance and real estate.