In the investment logic of looking for the process of global economic recovery, we pay more attention to the structural differences: one is the recovery order of different economies, and the other is the recovery order of industries.
Judging from the distribution of China's export destinations, Asia, Europe and North America are the largest export destinations. Since the beginning of this year, the proportion of Europe has declined, and the proportions of Asia and North America have increased slightly.
If we break it down further, we can see that the main demand side of China's exports is developed economies. Direct exports to the United States and the European Union account for nearly 40% of total exports; at the same time, many commodities exported to neighboring Asian countries and regions are ultimately demanded by developed economies. If we consider the exports of these neighboring countries and regions as If the demand of developed economies is driven, then the dependence of China's exports on developed economies is about 70%.
The other 20% of China's exports are driven by emerging market countries and resource countries, and the remaining 10% is the demand of developing countries. In terms of trends, the proportion of China's exports to developed economies is declining, while the proportion of exports to emerging markets has been rising; resource countries' imports to China are also rising, but they are more volatile. However, in the context of economic recovery in emerging markets and resource countries benefiting from rising commodity prices, we believe that this part of the recovery will be stronger, and the recovery in external demand driven by advanced economies will be more moderate.
Emerging markets recover stronger than developed economies
Judging from the published domestic GDP data for the second quarter, the seasonally adjusted GDP quarter-on-quarter annual rate in the second quarter was 14.9%, 6.4 percentage points higher than the first quarter. From the trend point of view, the low point of the economy appeared in the fourth quarter of 2008, and the current chain growth rate is relatively close to the historical high point, indicating that the Chinese economy has experienced a strong recovery in the second quarter.
The US GDP data released at the end of July also showed that the decline of the US economy began to shrink. In the second quarter, although the growth rate of the quarter-on-quarter year-on-year rate was still declining, the growth rate has narrowed sharply, rising from -6.4% in the first quarter to -1%. Judging from the comparison between China and the United States, the process of economic recovery in the United States is more lagging and lighter than that of China, but the trend is also improving.
The Chinese economy has taken the lead in recovering among the global economies. Thanks to the government ’s rapid and effective investment spending policy, fixed asset investment is the biggest driving force behind the strong rebound of the Chinese economy. The improvement of the US economy in the second quarter was mainly due to the narrowing of private investment and the promotion of government spending. Under the drag of unemployment, personal consumption expenditures in the United States contributed negatively to economic growth in the second quarter.
At the same time, from the perspective of other countries in the world, although there is no detailed GDP data, it can be seen from the industrial production data that industrial production in emerging market countries has shown a clear recovery, which is stronger than that of the United States and Europe.
The current recovery of the global economy, on the one hand, has benefited from the bottoming-up of the business cycle, and companies in the early stage have drastically reduced their inventories and investments. Now they have entered the stage of replenishing inventories and returning to normal operating levels; on the other hand, they have also benefited from the effect of government spending. Play a role, this role is more reflected in government investment. From the perspective of consumption, the rebound in consumption will be lagging behind due to the rebound in unemployment and savings rates. Therefore, in terms of short-term economic rebound, investment and inventory replenishment are the main driving forces, and more is the rebound in the manufacturing sector.
Whether it is the leading indicator of the economy or the synchronous indicator, it shows that the global economy is now gradually entering the recovery period from the recession period. The order of recovery: China is the earliest in the recovery period, and the bottom of the economy is the fourth quarter of last year; It has narrowed sharply and will gradually enter a recovery period in the second half of the year; the recovery time and degree of emerging markets are between China and the United States.
IMF data has a clear explanation for this. Emerging markets are leading industrial production mainly in developed economies, and the export link does not have much advantage. This shows that the emerging markets have played a certain role in domestic demand, but in the end, exports are still more dependent on the needs of developed economies; the lower exposure of emerging market financial markets to risks has a positive effect on economic recovery.
We believe that the leading recovery in emerging markets may have the following multiple reasons: 1. The macro fiscal policy is more stimulating, and the government ’s investment has a more direct driving effect on the economy; 2. The strong growth of China and India has produced better results for the East Asian emerging economies Leading role; 3. Some emerging markets belong to resource exporting countries and will benefit from rising resource prices; 4. The emerging market has a high savings rate, a reasonable fiscal revenue and expenditure structure, and a large accumulation of foreign exchange reserves, attracting capital to re-enter emerging markets, Help them achieve economic stability; 5. There is little pressure on asset impairment in emerging markets, and credit creation in the banking system is more smooth, which provides a better foundation for economic recovery.
The order of benefit of the industry chain in the context of export recovery
We used the export delivery value and sales revenue data to calculate the industry's export dependence, and used the national economic industry division. In terms of results, the industries of communications electronics, instrumentation, textiles and clothing, furniture, electrical machinery, rubber, plastics, and metal products are highly dependent on exports, and changes in exports will have a greater impact on the income of these industries.
At the same time, by calculating the proportion of exports in revenue, we have also measured the industry's export dependence. Judging from the situation of A-share listed companies, the industries most sensitive to the export environment are: wood furniture, delivery, electronic information, textile and clothing, machinery, metal and non-metal, agriculture, forestry, animal husbandry and fishery. These industries are basically in line with the industries with high export dependence calculated by our export delivery value and sales revenue. The difference is only in the degree of export dependence. This is mainly due to the representativeness of listed companies.
We have further calculated the fine-molecule industry of the main industries. The sub-industries with a high degree of export dependence are: shipping is mainly ocean transportation; electronic information is mainly electronic components, communication equipment manufacturing, computers and other sub-industries; machinery Mainly household appliances, instruments and special equipment; metal non-metals are mainly metal products industry; agriculture is mainly fishery; petrochemicals are mainly chemical fiber, pesticides, rubber and plastics.
Table 1: Estimation of export dependence of A-share sub-sectors
Export Dependence of Segmented Industries
Transportation, warehousing-water transportation 72.68%
Transportation, warehousing-coastal transportation 42.63%
Transportation, warehousing-Ocean Shipping 47.22%
Manufacturing--Electronics--Electronic Components Manufacturing 43.89%
Manufacturing--Machinery, Equipment, Instruments--Electrical Machinery and Equipment Manufacturing 25.85%
Manufacturing-machinery, equipment, instrumentation-instrumentation and culture, office machinery manufacturing 43.11%
Manufacturing-machinery, equipment, instruments-special equipment manufacturing 36.74%
Information technology industry 95.15%
Information Technology Industry-Computer and Related Equipment Manufacturing 54.37%
Information technology industry-communications and related equipment manufacturing 39.66%
Manufacturing-Metals, Non-Metals-Metal Products Industry 558.99%
Agriculture, Forestry, Animal Husbandry and Fisheries--Marine Fisheries 77.57%
Agriculture, Forestry, Animal Husbandry and Fisheries-Fisheries 35.29%
Manufacturing--Petroleum, Chemical, Plastic, Plastic--Chemical Fiber Manufacturing 21.38%
Manufacturing-Petroleum, Chemical, Plastic, Plastic-Chemical Fiber Manufacturing-Synthetic Fiber Manufacturing 55.79%
Manufacturing--Petroleum, Chemistry, Plastics, Plastics--Chemical raw materials and chemical products manufacturing--Chemical pesticide manufacturing 40.03%
Manufacturing--Petroleum, Chemical, Plastic, Plastic--Plastic manufacturing 21.17%
Manufacturing--Petroleum, Chemical, Plastic, Plastic--Rubber manufacturing 30.04%
Data source: Guojin Securities Research Institute
Industries with higher export dependence will benefit from the greater resilience of export recovery. At the same time, we have also judged the process of economic recovery before, that is, the recovery of emerging markets is faster than that of developed economies. Then, as the order of industry recovery under the rebound of exports, it should be the industry that is closer to emerging markets is more pulled. Therefore, we continue to conduct further analysis on different export countries in different industries.
By collating the data, we show the export countries of different industries in Figure 4. More than 70% of steel is exported to emerging markets, followed by chemical fiber, chemical products, and non-metals. The proportion of exports in emerging markets is 50% or more ; Over 70% of delivery equipment, furniture, machinery, and textiles are driven by the demand of developed economies.
From the perspective of historical trends, the demand for Chinese goods in emerging markets is mainly in the raw materials and capital goods industry. This is related to the infrastructure construction of emerging market countries. China ’s industrial products have a large scale advantage; in recent years, emerging markets The fastest increase in demand is in the following order: steel, non-metallic products, chemical products, rubber and plastics, furniture and mechanical equipment.
In summary, we believe that the global economic recovery in the second half of the year will bring investment opportunities to Chinese exports. We follow the logic that recovery in emerging markets is superior to developed economies; recovery in the industrial sector is superior to the consumer sector. It is believed that the order of the industrial chain promotion under the export recovery may be: 1. First, chemical and chemical fiber, steel, non-metallic products (glass), rubber, plastics, shipping and other raw materials and transportation service industries; 2. Second, metal products, machinery and equipment, electronics Communication equipment and other capital goods industries; 3. Once again, textiles, agriculture, forestry, animal husbandry and fishing, furniture and other optional consumer goods industries.
This is the order in which physical industries benefit from the logic of our global economic recovery. When the market is more optimistic about export recovery, it may show a general concern for the above industries, that is, export-related industries will show Certain investment opportunities. However, in terms of the certainty of fundamentals, we recommend paying attention to the recovery order of the above industries.
Figure 4: Statistics of exporting countries by different industries
Export recovery market will further expand
In the A-share market
Judging from the distribution of China's export destinations, Asia, Europe and North America are the largest export destinations. Since the beginning of this year, the proportion of Europe has declined, and the proportions of Asia and North America have increased slightly.
If we break it down further, we can see that the main demand side of China's exports is developed economies. Direct exports to the United States and the European Union account for nearly 40% of total exports; at the same time, many commodities exported to neighboring Asian countries and regions are ultimately demanded by developed economies. If we consider the exports of these neighboring countries and regions as If the demand of developed economies is driven, then the dependence of China's exports on developed economies is about 70%.
The other 20% of China's exports are driven by emerging market countries and resource countries, and the remaining 10% is the demand of developing countries. In terms of trends, the proportion of China's exports to developed economies is declining, while the proportion of exports to emerging markets has been rising; resource countries' imports to China are also rising, but they are more volatile. However, in the context of economic recovery in emerging markets and resource countries benefiting from rising commodity prices, we believe that this part of the recovery will be stronger, and the recovery in external demand driven by advanced economies will be more moderate.
Emerging markets recover stronger than developed economies
Judging from the published domestic GDP data for the second quarter, the seasonally adjusted GDP quarter-on-quarter annual rate in the second quarter was 14.9%, 6.4 percentage points higher than the first quarter. From the trend point of view, the low point of the economy appeared in the fourth quarter of 2008, and the current chain growth rate is relatively close to the historical high point, indicating that the Chinese economy has experienced a strong recovery in the second quarter.
The US GDP data released at the end of July also showed that the decline of the US economy began to shrink. In the second quarter, although the growth rate of the quarter-on-quarter year-on-year rate was still declining, the growth rate has narrowed sharply, rising from -6.4% in the first quarter to -1%. Judging from the comparison between China and the United States, the process of economic recovery in the United States is more lagging and lighter than that of China, but the trend is also improving.
The Chinese economy has taken the lead in recovering among the global economies. Thanks to the government ’s rapid and effective investment spending policy, fixed asset investment is the biggest driving force behind the strong rebound of the Chinese economy. The improvement of the US economy in the second quarter was mainly due to the narrowing of private investment and the promotion of government spending. Under the drag of unemployment, personal consumption expenditures in the United States contributed negatively to economic growth in the second quarter.
At the same time, from the perspective of other countries in the world, although there is no detailed GDP data, it can be seen from the industrial production data that industrial production in emerging market countries has shown a clear recovery, which is stronger than that of the United States and Europe.
The current recovery of the global economy, on the one hand, has benefited from the bottoming-up of the business cycle, and companies in the early stage have drastically reduced their inventories and investments. Now they have entered the stage of replenishing inventories and returning to normal operating levels; on the other hand, they have also benefited from the effect of government spending. Play a role, this role is more reflected in government investment. From the perspective of consumption, the rebound in consumption will be lagging behind due to the rebound in unemployment and savings rates. Therefore, in terms of short-term economic rebound, investment and inventory replenishment are the main driving forces, and more is the rebound in the manufacturing sector.
Whether it is the leading indicator of the economy or the synchronous indicator, it shows that the global economy is now gradually entering the recovery period from the recession period. The order of recovery: China is the earliest in the recovery period, and the bottom of the economy is the fourth quarter of last year; It has narrowed sharply and will gradually enter a recovery period in the second half of the year; the recovery time and degree of emerging markets are between China and the United States.
IMF data has a clear explanation for this. Emerging markets are leading industrial production mainly in developed economies, and the export link does not have much advantage. This shows that the emerging markets have played a certain role in domestic demand, but in the end, exports are still more dependent on the needs of developed economies; the lower exposure of emerging market financial markets to risks has a positive effect on economic recovery.
We believe that the leading recovery in emerging markets may have the following multiple reasons: 1. The macro fiscal policy is more stimulating, and the government ’s investment has a more direct driving effect on the economy; 2. The strong growth of China and India has produced better results for the East Asian emerging economies Leading role; 3. Some emerging markets belong to resource exporting countries and will benefit from rising resource prices; 4. The emerging market has a high savings rate, a reasonable fiscal revenue and expenditure structure, and a large accumulation of foreign exchange reserves, attracting capital to re-enter emerging markets, Help them achieve economic stability; 5. There is little pressure on asset impairment in emerging markets, and credit creation in the banking system is more smooth, which provides a better foundation for economic recovery.
The order of benefit of the industry chain in the context of export recovery
We used the export delivery value and sales revenue data to calculate the industry's export dependence, and used the national economic industry division. In terms of results, the industries of communications electronics, instrumentation, textiles and clothing, furniture, electrical machinery, rubber, plastics, and metal products are highly dependent on exports, and changes in exports will have a greater impact on the income of these industries.
At the same time, by calculating the proportion of exports in revenue, we have also measured the industry's export dependence. Judging from the situation of A-share listed companies, the industries most sensitive to the export environment are: wood furniture, delivery, electronic information, textile and clothing, machinery, metal and non-metal, agriculture, forestry, animal husbandry and fishery. These industries are basically in line with the industries with high export dependence calculated by our export delivery value and sales revenue. The difference is only in the degree of export dependence. This is mainly due to the representativeness of listed companies.
We have further calculated the fine-molecule industry of the main industries. The sub-industries with a high degree of export dependence are: shipping is mainly ocean transportation; electronic information is mainly electronic components, communication equipment manufacturing, computers and other sub-industries; machinery Mainly household appliances, instruments and special equipment; metal non-metals are mainly metal products industry; agriculture is mainly fishery; petrochemicals are mainly chemical fiber, pesticides, rubber and plastics.
Table 1: Estimation of export dependence of A-share sub-sectors
Export Dependence of Segmented Industries
Transportation, warehousing-water transportation 72.68%
Transportation, warehousing-coastal transportation 42.63%
Transportation, warehousing-Ocean Shipping 47.22%
Manufacturing--Electronics--Electronic Components Manufacturing 43.89%
Manufacturing--Machinery, Equipment, Instruments--Electrical Machinery and Equipment Manufacturing 25.85%
Manufacturing-machinery, equipment, instrumentation-instrumentation and culture, office machinery manufacturing 43.11%
Manufacturing-machinery, equipment, instruments-special equipment manufacturing 36.74%
Information technology industry 95.15%
Information Technology Industry-Computer and Related Equipment Manufacturing 54.37%
Information technology industry-communications and related equipment manufacturing 39.66%
Manufacturing-Metals, Non-Metals-Metal Products Industry 558.99%
Agriculture, Forestry, Animal Husbandry and Fisheries--Marine Fisheries 77.57%
Agriculture, Forestry, Animal Husbandry and Fisheries-Fisheries 35.29%
Manufacturing--Petroleum, Chemical, Plastic, Plastic--Chemical Fiber Manufacturing 21.38%
Manufacturing-Petroleum, Chemical, Plastic, Plastic-Chemical Fiber Manufacturing-Synthetic Fiber Manufacturing 55.79%
Manufacturing--Petroleum, Chemistry, Plastics, Plastics--Chemical raw materials and chemical products manufacturing--Chemical pesticide manufacturing 40.03%
Manufacturing--Petroleum, Chemical, Plastic, Plastic--Plastic manufacturing 21.17%
Manufacturing--Petroleum, Chemical, Plastic, Plastic--Rubber manufacturing 30.04%
Data source: Guojin Securities Research Institute
Industries with higher export dependence will benefit from the greater resilience of export recovery. At the same time, we have also judged the process of economic recovery before, that is, the recovery of emerging markets is faster than that of developed economies. Then, as the order of industry recovery under the rebound of exports, it should be the industry that is closer to emerging markets is more pulled. Therefore, we continue to conduct further analysis on different export countries in different industries.
By collating the data, we show the export countries of different industries in Figure 4. More than 70% of steel is exported to emerging markets, followed by chemical fiber, chemical products, and non-metals. The proportion of exports in emerging markets is 50% or more ; Over 70% of delivery equipment, furniture, machinery, and textiles are driven by the demand of developed economies.
From the perspective of historical trends, the demand for Chinese goods in emerging markets is mainly in the raw materials and capital goods industry. This is related to the infrastructure construction of emerging market countries. China ’s industrial products have a large scale advantage; in recent years, emerging markets The fastest increase in demand is in the following order: steel, non-metallic products, chemical products, rubber and plastics, furniture and mechanical equipment.
In summary, we believe that the global economic recovery in the second half of the year will bring investment opportunities to Chinese exports. We follow the logic that recovery in emerging markets is superior to developed economies; recovery in the industrial sector is superior to the consumer sector. It is believed that the order of the industrial chain promotion under the export recovery may be: 1. First, chemical and chemical fiber, steel, non-metallic products (glass), rubber, plastics, shipping and other raw materials and transportation service industries; 2. Second, metal products, machinery and equipment, electronics Communication equipment and other capital goods industries; 3. Once again, textiles, agriculture, forestry, animal husbandry and fishing, furniture and other optional consumer goods industries.
This is the order in which physical industries benefit from the logic of our global economic recovery. When the market is more optimistic about export recovery, it may show a general concern for the above industries, that is, export-related industries will show Certain investment opportunities. However, in terms of the certainty of fundamentals, we recommend paying attention to the recovery order of the above industries.
Figure 4: Statistics of exporting countries by different industries
Export recovery market will further expand
In the A-share market
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