Likes ReceivedJuly 26, 2024 morning trading strategy: Reduce positions when the market opens higher, and buy back on pullbacks! Focus on autonomous driving/equipment updates.
The index is still on the way to new lows, but market sentiment has warmed up first.
After a wave of bottomless declines, funds have started to frantically cluster together. Yesterday, trading volume returned to 5000+, but the overall leader, Volkswagen Transportation, is going further and further down the path of being a "monster stock."
This shows that even funds can't take it anymore—if the market doesn't give opportunities, they'll create their own.
After the market closed yesterday, the RMB started to perform, surging violently.
There are many versions of the story, but the main reason is the strengthening expectation of a Fed rate cut.
The U.S. July PMI recorded 49.5, already falling below the boom-bust line, lower than the expected 51.7 and the previous 51.6. The economic pressure is indeed quite high.
In the past two days, the Japanese yen index has also been soaring, with basically the same logic.
Once the rate-cut cycle begins, northbound funds are very likely to flow back in. This is also why the authorities have classified foreign capital as incremental funds.
Given the consecutive freezing points over the past two days, a higher open today shouldn't be a problem. What needs attention here is the rhythm—in a weak market, the biggest fear is an overly aggressive pre-market session. Sentiment is too fragile; if the pre-market is too strong, a pullback after an early surge is almost certain.
This is also when early selling is most likely to occur. So, if the open is too strong, there will probably be a pullback after an early surge—just follow by reducing some positions and consider buying back after the dip.
Now, let’s look at themes and individual stocks:
1. Autonomous Driving
It was very strong yesterday. The sector leader, Volkswagen Transportation, continued to advance, driving rebound limit-ups in smaller players like Jinlong Automobile and Jinjiang Online.
After the market closed, another positive development emerged for the auto sector: subsidies for scrapping fuel vehicles were raised from 7,000 yuan to 15,000 yuan, and for scrapping new energy vehicles, from 10,000 yuan to 20,000 yuan.
This news will also stimulate the auto OEM sector. Some funds had already positioned themselves yesterday, so keep an eye on auto + autonomous driving concepts today.
2. Equipment Upgrades (Autos, Home Appliances)
After the market closed yesterday, two departments rolled out major policies—this time with exceptionally high subsidies. The auto and home appliance trade-in policies exceeded expectations! They also allocated 300 billion yuan in ultra-long-term special treasury bond funds, signaling a massive interest-subsidy push.
The home appliance sector benefits white goods and companies with high domestic sales exposure. The kitchen appliance segment is also worth watching.
The auto subsidy policy is far beyond expectations, especially for the commercial vehicle sector—it’s like rain after a long drought.
The copyright of this article belongs to the original author/organization.
The views expressed herein are solely those of the author and do not reflect the stance of the platform. The content is intended for investment reference purposes only and shall not be considered as investment advice. Please contact us if you have any questions or suggestions regarding the content services provided by the platform.
