US economic stimulus plan reached! After the U.S. stocks soared in the Asia-Pacific carnival, has the global stock market inflection point already reached?

Sino-Singapore Jingwei Client, March 25th (Dong Wenbo) After performing 4 blowouts in 10 days, the US stock market overnight witnessed history again!

On Tuesday (24th) Eastern time, U.S. stocks rebounded retaliated. The three major indexes continued to climb after opening higher. The Dow soared 11.37% and soared 2100 points, not only regaining the 20,000-point integer mark, but also hitting 1933 (87 years ago) The biggest single-day gain. The Nasdaq closed up 8.12%; the S & P 500 closed up 9.38%, its best single-day performance since October 2008.

Dow on the 24th Source: Wind

On the disk, technology stocks rose across the board, Apple rose 10.03%, and its market value returned to trillions of dollars. Microsoft, Facebook, and Google rose 9.09%, 8.70%, and 7.20%, respectively. Among the most popular Chinese stocks, Ruixing Coffee rose more than 15%, Weilai, Bilibili rose nearly 10%, NetEase rose more than 8%, Alibaba, Baidu, Jingdong, Pinduoduo rose about 6%.

Asia Pacific Market Carnival

The overnight rally in US stocks brought revelry to global financial markets. On the 25th, the Asia-Pacific market continued its strength. The Nikkei 225 index opened higher and went higher in late trading. The increase rose to 8%. The Japanese TSE REIT index futures triggered a fusing mechanism during the session. The Korean composite index rose over 5% during the session. The stock markets of the Philippines, Malaysia, Thailand, Vietnam and other countries have successively opened, and staged a rally.

The performance of the A-share market was equally bright, with the Shanghai Index opening 1.94% higher, the Shenzhen Component Index and the GEM Index opening more than 2%. As of 15:00 (closed), the Shanghai Composite Index rose 2.17%, while the Shenzhen Component Index and ChiNext Index rose more than 3%. On the disk, major industry sectors rose across the board, with autos, pharmaceuticals, electronics and other sectors leading the gains. Gold stocks were collectively popular, and Oriental Jinyu, Yimin Group, and Cuihua Jewelry rose to a daily limit.

Shanghai and Shenzhen stock market closing performance on the 25th Source: Wind

The new energy vehicle industry chain, which had a sharp correction before, broke out. Power batteries, smart speakers, wireless charging, and Tesla Indexes were active. The leader of the Ningde era surged more than 9%.

During the same period, the Hong Kong Hang Seng Index remained volatile and increased by 3% by 15:00. In addition, the MSCI Asia Pacific Index rose 5%, its largest increase since October 2008.

American epic stimulus plan launched

The main reason for the jubilation of the US stock market and the global market is the American epic stimulus plan!

The latest news on the afternoon of Beijing time on the 25th shows that in the early morning of the 25th local time, the US White House and the Senate leaders reached a breakthrough agreement involving a $ 2 trillion New Crown virus rescue plan.

The Associated Press and Fox News reported that White House director of legislative affairs Eric Ulan announced early in the morning that "Ladies and gentlemen, we have finished talking and we have reached an agreement."

According to sources, the total value of the US economic stimulus measures is more than $ 2 trillion, of which $ 250 billion is for unemployment assistance and $ 130 billion is provided to assist hospitals. The stimulus agreement will also provide about $ 50 billion to the aviation industry.

After the news was announced, the US stock index futures all turned up, the Dow futures rose to 1%, and the S & P 500 index futures and the Nasdaq futures rose in the short-term.

In fact, as early as Monday, 23rd, local time, there were reports that US Treasury Secretary Mnuchin and Senate Minority Leader Chuck Schumer stated that the two parties still have some of the third round of fiscal stimulus policies. Small difference, but very close to reaching agreement.

At 10 pm Beijing time on the 24th (half an hour after the opening of the US stock market, Tuesday morning local time), a new round of discussions in the US Congress on the economic stimulus plan began. Before the discussion, US President Trump tweeted four in a row, saying "Today Congress must ratify the agreement without any nonsense. The longer the time, the more difficult our economy will be."

Source: Trump Twitter

Not only that, on the same day, Trump said in an interview with Fox News TV that he was considering relaxing the control measures on the epidemic, hoping that the United States could be "open" by mid-April. This statement is also considered to be one of the reasons for the surge in US stocks on the 24th.

Trump said, "We will conduct an assessment in early April. If more time is needed, we will give the epidemic more time to control, but the country needs to continue to operate. Everyone has to go back to work to get work and life back to normal. Lifting the epidemic restriction) must be earlier than everyone expected. "However, many medical experts disagree with Trump's view that it is too early to release the restriction order by mid-April, and the United States will prevent and control the new crown pneumonia epidemic. The situation is not optimistic.

According to the latest statistics released by Johns Hopkins University in the United States, as of 10:20 on the 25th, Beijing time, the total number of confirmed cases of new crown pneumonia in the world exceeded 420,000 to 421,792, and the cumulative death toll reached 18,883. Among them, the number of confirmed cases in the United States increased to 54,893 cases, 32,991 cases in Germany, and 22,633 cases in France.

US House of Representatives Speaker Nancy Pelosi also strongly opposed Trump's comments. Pelosi said that after the new crown pneumonia epidemic, the economy will naturally recover; Trump should listen to the advice of scientists, and should pay attention to "respect for science and pay attention to evidence" in his speech.

G7 Group: Restore confidence and economic growth at all costs

In addition to the US stimulus plan, the G7 Group is also moving.

According to the US Treasury's website, G7 Group issued a statement again on the evening of the 24th, Beijing time, in accordance with the instructions of leaders of various countries, is taking proactive actions to address the global health, economic and financial impacts associated with the spread of coronavirus disease.

The statement states that member states have launched a stimulus package. In addition, countries are developing new policies, such as providing assistance to employment, telecommuting and vulnerable groups, expanding access to childcare and unemployment benefits; providing liquidity support, guarantees, subsidized loans, tax deferral, and deferred loan repayment, etc. .

The G7 Group is committed to restoring confidence and economic growth at all costs, protecting employment, resilience of the financial system and businesses, and protecting global trade and investment.

Prior to this, Kristalina Georgieva, president of the International Monetary Fund (IMF), pointed out that due to the new crown pneumonia epidemic, the global economy will decline in 2020 and it is expected to rebound in 2021.

Data Map: IMF President Georgieva. Photo by Shaoxing Ting, China News Agency

On the 23rd local time, Georgieva made a statement on the IMF's official website after a conference call with the G20 finance minister and the central bank governor. She said that the most important thing now is to prioritize prevention and control measures and strengthen the health system. At present, the economy has been and will continue to be severely affected, but the sooner the epidemic is controlled, the faster and stronger the economic recovery will be.

Georgieva pointed out that the IMF supports special fiscal actions to strengthen health systems and protect workers and businesses affected by the outbreak, and welcomes the central bank's measures to relax monetary policy. These measures are not only in the interests of each country, but also in the overall interests of the global economy.

Has the global stock market stopped falling signals?

Under the package of news, how will the global stock markets and US stocks after the retaliatory rebound rebound?

CITIC Securities believes that since the end of February, the new crown pneumonia epidemic has spread globally, and global assets have fluctuated significantly. However, with the strict control of the epidemic situation and the introduction of economic rescue measures in various countries, the market will be ahead of the improvement of the epidemic situation and resume its upward trend. At present, the policy, fundamentals and sentiment have all shown signs of stopping. U.S. stocks are expected to stabilize and rebound, and A-shares will also have the best buying points when foreign capital flows back.

In the US stock market, Caixin think tank Monita pointed out that with the stock market liquidity problems being eased and the heavy fiscal stimulus plan expected to be introduced, the probability of a sharp decline in US stocks has temporarily come to an end, and there may even be some short-term Repairing the rebound, the logic of large-scale assets will also temporarily return to normal mode. However, the long-term trend of US stocks and the future liquidity situation still depend on the spread of the US epidemic and the performance of economic data, which still needs to be closely monitored.

Haitong Securities said that at present the Fed has covered most markets with liquidity support. At present, systemically important financial institutions are more secure and the risk of the financial crisis is small. It is worth noting that the spread of the epidemic leads to a higher risk of a major economic recession. Only by controlling the epidemic and making the future economy relatively short-term recession, but the prospects are relatively measurable, can we basically reduce panic and rebuild confidence.

From the perspective of technology stocks alone, CITIC Securities pointed out that the recent pullback of U.S. technology stocks has reflected the short-term impact of the epidemic, and the static valuation of the sector has returned to the 10-year average. However, considering the risk of downward revision of earnings caused by the epidemic, the market is expected Will continue to be under pressure. In the medium and long-term perspective, the U.S. stock market has gathered most of the world's highest-quality technology assets. It is expected that the medium- and long-term performance of the technology sector will continue to be supported by 5G technology cycles and cloud computing. (Zhongxin Jingwei APP)

(The opinions in this article are for reference only and do not constitute investment advice. Investment is risky and you must be cautious when entering the market.)

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