Yesterday, the real estate sector welcomed a long-awaited surge, with a single-day intensity being the highest in nearly six months. The real estate development sector closed with an increase of about 2%, ranking among the top of the industry gains. Leading stocks: Vanke A closed its board in 5 minutes, with a total transaction amount exceeding 3.2 billion yuan, creating the largest single-day increase of the year.
On December 11, the A-share real estate sector as a whole declined, becoming one of the industries with the largest drop that day. In terms of indices: The CSI All Share Real Estate Index, after soaring 2.32% on the previous trading day, pulled back about -1.2% that day. The net outflow of main funds in the real estate sector exceeded 2 billion yuan in a single day, ranking among the top of all industries, with Vanke down 3.43%. The real estate sector showed a rapid reversal characteristic after a 'one-day tour' on December 11.
Looking back, in 2019, the total GDP (current price): 986,515 billion yuan, GDP growth rate (constant price): 6.0%, total approaching the 100 trillion yuan mark. Per capita GDP converted at the annual average exchange rate also broke 10,000 USD for the first time. In 2020, total (preliminary estimate): 101.60 trillion yuan, growth rate: 2.3%. Affected by the COVID-19 pandemic, the economy declined by 6.8% year-on-year in the first quarter, and then gradually recovered. The pandemic in 2020 became a watershed for the economic downturn. In 2021, total (preliminary estimate): 114.37 trillion yuan, growth rate: 8.1%, achieving high growth driven by a low base and economic recovery. In 2022, total (preliminary estimate): 121.02 trillion yuan, growth rate: 3.0%. In 2023, total (revised): 129.43 trillion yuan. The World Bank predicts a growth rate of 4.9% for 2024.
Real estate has always been the pillar industry of our economy. To address the current trend of deflation and declining CPI, and to stop the downward pressure on the economy, we still need to look at real estate. The country may continue to take major actions in the real estate sector.
The Federal Reserve announced another 25 basis point rate cut after its last monetary policy meeting of the year, lowering the target range for the federal funds rate to 3.50%–3.75%. This is the Fed's third rate cut of the year, following cuts in September and October, with a total reduction of 75 basis points for the year. There were 9 votes in favor and 3 against, the highest number of dissenting votes since 2019. The statement emphasized that U.S. job growth is slowing and the unemployment rate has slightly increased. Although inflation remains above the 2% target, the risk balance has tilted towards 'employment', prompting the decision for a 'preemptive' rate cut. Following the announcement of the resolution, the three major U.S. stock indexes rose collectively, with the Dow Jones up about 1%; the dollar index fell below 99, and U.S. Treasury yields slightly declined; spot gold and silver prices surged, with silver prices hitting a new historical high during the session.
Goldman Sachs stated that the renminbi is undervalued by 25%, and its appreciation will exceed the pricing shown in forward contracts. This Wall Street institution referred to the renminbi as one of its 'highest conviction' trades, claiming that the renminbi is undervalued according to its forecast exchange rate model. The model aims to predict the optimal exchange rate level needed to maintain the fundamental economic conditions of China, including the stability of the current account, economic growth, and price stability. Driven by factors such as a weakening dollar, capital inflows into the domestic stock market, the internationalization of the renminbi, and a stronger midpoint rate, both onshore and offshore renminbi are expected to achieve their first annual appreciation since 2021.