国内焦点

A Definitive Guide to Chinas Economic Cycle(4)

字号+ 作者: 来源: 2017-03-24

2016 again experienced a restocking frenzy, after five years of dormancy. Some investors asked whether the 5-year hibernation would mean a stronger and longer restocking cycle. But we note that iron

  2016 again experienced a restocking frenzy, after five years of dormancy. Some investors asked whether the 5-year hibernation would mean a stronger and longer restocking cycle. But we note that iron ore inventory at ports has reached new historic high. Even if inventory level can continue to pile up, its speed of rising will decelerate, and the strong momentum in commodities will likely wane consequently (Focus Chart 5).

  China’s cyclical relative strength as a long leading indicator.

  China’s cyclical relative performance peaked last summer; it suggests defensive rotation now.While the debate about the reflation trade intensifies, China’s cyclical sectors’ relative performance had already peaked last summer – at roughly the same time when the upstream iron ore cycle peaked around May 2016. This observation contradicts the general sense that cyclical sectors have outperformed. Given the close correlation of cyclical sectors’ relative strength with the economic cycle, this observation also suggests that the so-called “cyclical recovery” is probably a chimera, and the momentum in the current recovery is about to roll over.

  Focus Chart 6: Relative performance of Chinese cyclical leads China/US 10y and US cyclical relative performance by ~9m.

  

A Definitive Guide to Chinas Economic Cycle

  Surprisingly, our research reveals that the relative performance of China’s cyclical tends to lead US cyclical sectors’ relative strength, and both US and China’s 10-year yield by around nine months (Focus Chart 6). The relative strength in Chinese cyclical over defensive measures the embedded investor expectation regarding growth outlook. It leads economic growth by around nine months as well. As China’s growth outlook fades, bond yields and foreign cyclical should fall. We believe that the momentum in the current cyclical upswing is waning. And so will the upward thrust in US and China’s 10-year yield.

转载请注明出处。


1.本站遵循行业规范,任何转载的稿件都会明确标注作者和来源;2.本站的原创文章,请转载时务必注明文章作者和来源,不尊重原创的行为我们将追究责任;3.作者投稿可能会经我们编辑修改或补充。

相关文章
  • 新型冠状病毒属于SARS冠状病毒怎么回事 新型冠状病毒比SARS狡猾!

    新型冠状病毒属于SARS冠状病毒怎么回事 新型冠状病毒比SARS狡猾!

  • 张洪泉:贵阳工地疑似坍塌 需举一反三

    张洪泉:贵阳工地疑似坍塌 需举一反三

  • 2017韩春雨最新消息 韩春雨ngago论文被自然子刊撤稿 系主动撤回

    2017韩春雨最新消息 韩春雨ngago论文被自然子刊撤稿 系主动撤回

  • 国务院参事:肥料业必须供给侧改革 不改死路一条

    国务院参事:肥料业必须供给侧改革 不改死路一条