News summary
April data shows economic recovery is driven by supplyabugarciacatfishpro7000, domestic demand is weak; the trend may continue in the second quarter. The government purchases commercial housing and land to help real estate companies improve liquidity, but real estate stabilization takes time to observe. The equity market responded actively to policy adjustments, while the bond market was relatively inactive. Risks include geopolitics and policies that exceed expectations.
Newsletter text
[Supply expansion drives economic recovery]
Data for April this year showed that the economy has gradually returned to health due to the expansion of the supply side. However, domestic demand is still performing poorly.
Nominal growth is lower than real growth
The pressure on corporate profits has increased, which suggests that improvements in the supply side may not be fully translated into positive signals on the demand side.
Government purchases commercial housing and land
Recently, the government has taken acquisition measures aimed at injecting liquidity into real estate companies, improving their financing conditions, and preventing further market tightening.
[The stability of the real estate market requires long-term observation]
The stabilization process of the real estate industry may be relatively long, and it is necessary to consider the downward pressure on the industry and the details of policy implementation.
Differential responses between bond markets and equity markets
In the adjustment of real estate policies, the reactions of the bond market and the equity market show different characteristics. The equity market relies more on expectations for pricing, while the bond market pays more attention to the actual effects of policies.
[Differences between policy implementation and market expectations may increase volatility]
In the process of policy advancement, differences between expectations and reality may further aggravate the volatility of the equity market.
Risk Warning
Risks that need to be aware of include geopolitical factors and policies that exceed expectations.
