Attention is focused on the results of both meetings in China in March
Pay attention to whether it will act as a factor for market stability
On the 28th, the Dongmyo Flea Market in Sungin-dong, Jung-gu, Seoul is crowded with crowds. News 1
As vaccination for the new coronavirus infection (Corona 19) has started in Korea, expectations are growing for a full-fledged economic recovery.
According to the financial investment industry on the 28th, if the benefits from liquidity and digital transformation have been concentrated in the non-face-to-face (untact) industry for about a year after the Corona 19 incident, then the recovery trend will continue to the face-to-face industry by the second half of this year due to vaccination. There is a prospect that it will expand.
Immediately after the coronavirus outbreak, as a result of swift responses from governments to policies, household disposable income increased rather than before the outbreak. Disposable income in the U.S. rose 16.1% year-on-year as of April last year, and 5.4% year-on-year in Korea as of the second quarter of last year, the highest since the statistics were written.
The problem is that due to consumption constraints caused by the economic blockade and uncertainty in future incomes, it was seen as an increase in preliminary savings rather than an increase in consumption. The US personal savings rate, which remained at the 7% level on average, rose to 34% in April last year, and remained at the 10% level until the end of last year.
According to the Bank of Korea estimate, Korea is also expected to rise from 6% in 2019 to 10% last year, the highest since 1999. Researcher Dami Kim of Shinhan Investment Corp. interpreted it as “the amount of money that can be used has increased due to the expansion of government support, but there have been fewer useful places, whether voluntarily or involuntarily.
The decrease in household consumption had a greater impact on services than goods and non-essential consumption items rather than essential. However, as vaccination began in earnest in Korea on the 26th, the mood is expected to rebound. The government set a goal of completing the first vaccination for more than 70% of the population by September and forming a collective immunity by November to escape from the Corona 19 crisis. Part of the concern about vaccine side effects and variant viruses, centered on medical and academic circles, remains as a variable.
On the 18th at Poonglim Pharmatech in Gunsan-si, Jeollabuk-do, employees of the company produced the least residual type (LDS) syringe. yunhap news
Retaliation and deferred consumption in line with expectations of an economic recovery are expected to stand out in face-to-face industries, such as services that were hit hard by the corona crisis. Lee Hyeok-jin, senior researcher at Samsung Securities, said, “When you start going out, the first thing you should pay attention to is cosmetics,” he said. “Because it is a global issue, it is necessary to pay attention to cosmetics ODM and OEM companies that supply various brands.” The travel and aviation industry, which was hit by strong containment measures, is also expected to benefit from vaccination.
Some analysts say that the future share price trend depends on the manufacturing industry rather than consumer sentiment.
Park Sang-Hyun, a researcher at Hi Investment & Securities, said, “In the case of Korea, the flow of the manufacturing industry’s BSI (Company Business Survey Index) is an important variable.” The manufacturing industry sentiment and domestic stock prices show a higher correlation.”
Meanwhile, the direction of the domestic stock market this week (March 2-5) is expected to draw attention to the trend of US Treasury yields and both sides in China. It is noteworthy whether the results of the two meetings in China can serve as a factor for stabilizing the market and boost investor sentiment.
According to the financial investment industry, the KOSPI index is expected to fluctuate this week within the range of 2950 to 3150.
When the new coronavirus infection (Corona 19) vaccine arrived at the Ulleungdo Naval Force Heliport using the Air Force Sinuk (CH-47D) helicopter on the 28th, the Vaccine Transportation Support Headquarters soldiers sealed the transport vehicle. Provided by the Ministry of Defense
Corona 19 vaccination is a factor in the stock market, but a rise in US Treasury yields and a valuation burden could increase the likelihood of a decline in the index.
Last week, the domestic stock market plunged due to the shock from rising US Treasury yields. However, thanks to the individual’s net purchase of over 3 trillion won, it managed to keep the 3000 line. In the New York Stock Exchange last week, major indices ended mixed tax after showing great volatility linked to fluctuations in US Treasury yields. The Dow Jones 30 Industrial Average fell by 1.8% last week. The Standard & Poor’s (S&P500) index fell by about 2.5% and the Nasdaq fell by 4.9%.
Zero Powell, chairman of the U.S. Central Bank (Fed), has dismissed concerns about inflation, but the market reaction is still unstable.
The US 10-year Treasury bond yield has exceeded the psychological resistance level of 1.5%. For the time being, it is expected that volatility will increase while paying attention to the direction of US interest rates.
The market’s interest this week is expected to be concentrated on both sides of China. According to foreign media, there is a forecast that an economic stimulus plan worth 25 trillion yuan will be passed through both meetings. Expectations for investment from China have been high every year, but this year, interest is bound to draw more attention along with reflation.
The market is paying attention to the economic growth target of the 14th Five-Year Plan (2021-2025) starting from this year and the realization of the bicyclic strategy. In particular, the key question is whether policy capabilities can be focused on domestic consumption, which requires a relatively additional recovery in the aftermath of Corona 19.
Reporter Kim Joon-young [email protected]
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