【Focus】Highlights of the Two Sessions in the First Year of the "14th Five-Year Plan"
[Fellow Investor Discusses Hot Topics] Key Issues at the Two Sessions in the Opening Year of the 14th Five-Year Plan
Table of Contents
1. Hotspot background
2. Two Sessions buzzwords
3. Fellow investor perspectives
4. Institutional perspectives
1. Hotspot background
The start of the year is marked by the Two Sessions. The fourth session of the 13th National Committee of the Chinese People's Political Consultative Conference and the fourth session of the 13th National People's Congress opened on March 4 and 5, respectively. Around the Two Sessions each year, the market often sees a wave of 'Two Sessions buzzwords.' There are two types of buzzwords: one consists of recurring topics that remain relevant year after year, while the other highlights new themes aligned with key national development areas. Core issues discussed during the Two Sessions are highly likely to become benchmarks for market investment, with investors usually taking positions in advance, waiting for the hot topics to gain momentum.
This year marks the beginning of the '14th Five-Year Plan,' making the Two Sessions particularly noteworthy! Let’s take a look at the 'Two Sessions buzzwords' circulating within the investment community, as highlighted by popular opinion leaders~
2. Two Sessions buzzwords
Top buzzword No.1 : Carbon Neutrality & Carbon Peak
The concepts of 'carbon neutrality' and 'carbon peak' have become the hottest topics.
'Carbon peak' refers to the point at which carbon dioxide emissions reach their highest level at a specific time and then gradually decline. 'Carbon neutrality' is the offsetting of one’s own CO2 emissions through afforestation, energy conservation, and emission reduction measures over a certain period, achieving 'zero CO2 emissions.' China aims to ensure that its CO2 emissions peak before 2030 and strives to achieve carbon neutrality by 2060. In recent trading sessions, 'carbon neutrality' has gained significant momentum, with related sectors such as photovoltaics, wind energy, ultra-high voltage, and environmental protection performing strongly.
Hot Word No. 2：Technological Innovation & Self-reliance
'Technological innovation' and 'self-reliance' have been given extremely important status. The first two priorities among this year’s eight key tasks outlined in the Central Economic Work Conference are:First, strengthening national strategic scientific and technological capabilities; second, enhancing the self-reliant ability of industrial and supply chains.Many fellow investors believe that sectors such as semiconductor chips, artificial intelligence, 5G, servers, high-end software, and information security are worth paying attention to.
Hot Word No. 3：Stimulate domestic demand
At local legislative meetings, the vast majority of provinces listed expanding domestic demand and accelerating the release of consumer potential as one of their key tasks for the year. Expanding domestic demand primarily means boosting consumption, which serves as the foundation for achieving a strong domestic economic cycle. During the 14th Five-Year Plan period, demand-side management has been placed on the agenda.This implies that the fundamental role of consumption in the economy needs to be further strengthened. In this regard, many fellow investors have started paying attention to investment opportunities brought by rural revitalization and new urbanization.
Hot Word No. 4: Reproductive policy
Although our country's birth policy has shifted from 'selective two-child' to 'universal two-child', the current fertility level still shows a downward trend,and related policies on relaxing birth restrictions have become hot topics at the Two Sessions.Popular Girl noticed that the enthusiasm of fellow investors towards the baby care sector has surged significantly; some creative investors even began speculating whether loosening birth policies would benefit toy stocks~
Hot Word No. 5: Food security
As the saying goes: Storing grain is as precious as gold, with grain there’s no need to worry. Food security is of utmost importance for our country, and in this year's 'No.1 Document,' food security occupies the largest portion of the section on agricultural modernization,with policy focus shifting from short-term supply increases to long-term orderly development.In the investment community, related sectors such as seed industry, agricultural technology, and breeding have also received significant attention.
Focusing on the Two Sessions topics to uncover investment opportunities. Many fellow investors have shared their views on the Two Sessions, and Popular Girl will take you through them.
3. Fellow Investor Insights
@韭菜专业户：In conjunction with the 14th Five-Year Plan, seek out opportunities with long-term continuity.。
@Mcdull71：New energy vehicles have substantial room for penetration rate growth and promising prospects.
@沙茶居居：Optimistic about subsectors within the photovoltaic, energy storage, and new energy industrial chain.
4. Institutional perspectives
@TF Securities Research Institute Aggregate Team：With the Two Sessions approaching, what should we focus on?
The current main trading theme in global equity markets is 'global economic recovery, rising inflation, and the rebound in US real interest rates.' The pricing focus has shifted from the denominator to the numerator, and the value sector has started to recover from its previous divergence from growth stocks. This round of recovery is expected to continue until long-term real interest rates have fully recovered.
Overall, as the impact of the pandemic is expected to gradually diminish and the economy returns to normalization, the policy direction during the Two Sessions may also progressively shift towards normalization. The market has seen significant cumulative gains since rebounding from the lows post-pandemic. The overall market valuation is not low, and structural valuations are at historical highs.
We believe that the overall tone of the Two Sessions will revolve around the general principle of seeking progress while maintaining stability, with a focus on deploying eight key tasks for 2021 and twelve initiatives for the 14th Five-Year Plan. Against the backdrop of avoiding abrupt policy shifts, both monetary and fiscal policies will normalize at a moderate pace. In the context of a new stage of development, new development philosophy, and a new development pattern, the post-pandemic era is set to usher in a new chapter of economic growth and transformation.
For more exciting content, click on the topic to view.：[Focus] Key highlights of the Two Sessions in the opening year of the 14th Five-Year Plan
Risk Disclaimer: The above content only represents the author's view. It does not represent any position or investment advice of Futu. Futu makes no representation or warranty.Read more
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