As the disclosure of the 2019 semi-annual report comes to an end, the performance of A-shares in the first half of the year, known as the "economic barometer," has also emerged.

Wind statistics show that among the 1,784 listed companies that can currently be counted, 1,229 have positive year-on-year growth in operating income in the first half of this year, accounting for nearly 70%; further statistics show that the average return on net assets of 1,713 listed companies is 3.79%.

“It can be seen from the data in the semi-annual report that the prosperity of industries such as chemicals, infrastructure, and engineering is relatively good, which fully reflects the resilience of the Chinese economy.” The chief strategist of a listed securities firm in Beijing told reporters.

Some analysts also said that the short-term market continues to bottom out, and corporate profits are expected to bottom out in the third quarter year-on-year. It is still a layout period to prepare for the second wave of the bull market.

The economy is showing signs of improvement

On the afternoon of August 25, nearly a hundred listed companies including Guorui Technology (600562.SH), Smart Energy (600869.SH), and Jinlaite (002723.SZ) released their 2019 semi-annual reports. As of now, more than 1,700 listed companies, or nearly half of the listed companies, have completed the disclosure of their interim reports.

Yicai Global conducted statistics from multiple Shenwan first-level industries such as electronics, computers, chemicals, infrastructure, media, engineering machinery, food and beverages, and power equipment, and sorted out the performance and development of nearly half of the listed companies to get a glimpse of China's economic development and growth.

According to incomplete statistics, in the chemical industry, the companies whose interim results exceeded expectations are Limin Holdings (002734.SZ), Li Anlong (300596.SZ), and Linglong Tire (60196 6.SH), Hualu Hengsheng (600426.SH), Xingyuan Materials (300568.SZ), Shuangjian Shares (002381.SZ), Xinnong Shares (002942.SZ), etc.

Take PTA as an example. In the first half of the year, the average price of PTA increased by 618 yuan/ton year-on-year, and the average price difference increased by 294 yuan/ton year-on-year, indicating that it has entered the high point of the boom cycle.

Among the corresponding listed companies, Rongsheng Petrochemical (002493.SZ) achieved operating income of 39.5 billion yuan in the first half of this year, a year-on-year increase of 5.3%; net profit attributable to the parent company was 1.046 billion yuan, and in the second quarter, net profit attributable to the parent company was 442 million yuan.

The interim report released by Hengli Petrochemical (600346.SH) showed that during the reporting period, the company achieved operating income of 42.333 billion yuan, a year-on-year increase of 60.04%; net profit was approximately 4.021 billion yuan, a year-on-year increase of 113.62%, including 480 million yuan in the first quarter and 3.541 billion yuan in the second quarter.

Analysts said that the company's profit in the second quarter was very impressive for two reasons. First, the commissioning of the 20 million tons/year refining and chemical integration project brought a large increase. During the reporting period, Hengli Refining and Chemical (refining and chemical business) achieved a net profit of 1.361 billion yuan; second, the PX price profit fell in the second quarter, and the PTA segment was highly prosperous and achieved a net profit of 1.829 billion yuan.

Equally outstanding is the engineering and infrastructure industry.

Jidong Cement (000401.SZ)'s interim report showed that in the first half of the year, it achieved operating income of 16.078 billion yuan, a year-on-year increase of 25.18%; net profit attributable to shareholders of the listed company was 1.480 billion yuan, a year-on-year increase of 60.82%; during the reporting period, it sold 45.28 million tons of cement clinker, a year-on-year increase of 12.83%.

“Jidong Cement’s outstanding performance in the first half of the year will only be achieved in the next two years.The start of a booming economy and the production restrictions in Tangshan from June to July make prices in the Beijing-Tianjin-Hebei region not bearish in the off-season. Analysts from Pacific Securities said that with the support of policies, the certainty of infrastructure recovery in the second half of the year has increased, and demand in the Beijing-Tianjin-Hebei region, which is dominated by key projects, is expected to grow steadily. Since the production capacity of small enterprises has been fully released, there is limited room for supply deterioration, and there is a strong certainty that the supply and demand pattern will continue to improve.

"From the feeling here, there are still a lot of projects, and I am actually not worried about running out of work now." "An engineering project leader in the Jiaodong Peninsula also said in a private exchange with reporters.

Correspondingly, construction machinery maintains a high level of prosperity, and the market share of the leading company's full range of products continues to increase. Benefiting from multiple factors such as infrastructure construction, equipment updates, and labor substitution, the construction machinery industry continues to maintain a rapid growth trend.

Sany Heavy Industry (600031.SH) estimates that the net profit attributable to the parent company in the medium term will be 65~70 billion, a year-on-year increase of 91.8% to 106.6%, which also exceeded market expectations.

“It can be seen from the data in the semi-annual report that the prosperity of industries such as chemical industry, infrastructure, and engineering is relatively good, which fully reflects the resilience of the Chinese economy. " Said the chief strategist of a listed securities firm in Beijing.

What needs to be noted is that despite the tightening of real estate trust margins, real estate trust funds accounted for less than 6% of the overall real estate funding sources in 2018, but the psychological impact is greater than the actual impact. The absolute sales volume of the construction machinery industry will remain high in the second half of the year Operation, the growth rate will fluctuate within a small range.

In addition, the performance of the coal sector on behalf of listed companies is also remarkable. On August 23, 2019, Yangquan Coal Industry (600348.SH) released its semi-annual report. Revenue in the first half was 15.526 billion yuan, a year-on-year decrease of 7.68%; net profit attributable to shareholders of listed companies was 10. 6.3 billion yuan, a year-on-year increase of 20.06%; in the second quarter, the net profit attributable to the parent company was 534 million yuan, a year-on-year increase of 38.81%, and a month-on-month increase of 0.93%, exceeding market expectations.

Clearly optimistic about technology

Not only the performance of engineering infrastructure and chemical industry is outstanding, but the electronics, computer and other sectors are also outstanding.

< p> Recently, Luxshare Precision announced its 2019 semi-annual report, with revenue in the first half of the year of 21.44 billion, a year-on-year increase of 78.3%, and net profit attributable to the parent company of 1.5 billion, a year-on-year increase of 81.8%. It also predicted that the performance growth range for the first three quarters would be 50-60%.

As of the close of trading on August 23, Luxshare Precision closed at 25.67 yuan/share, an increase of 10%. 5.16%, a record closing high. Since the beginning of this year, Luxshare Precision's stock price has soared 138.13%, which is much higher than the increase of Kweichow Moutai in the same period (96.38%), significantly outperforming the market.

In addition, the performance of Goertek and iFlytek in the electronics sector are also outstanding, and they have also exceeded market expectations.

The 2019 semi-annual report shows that the listed company's revenue was 4.228 billion yuan, a year-on-year increase of 31.72%; the net profit attributable to the parent company was 189 million yuan, a year-on-year increase of 45.06%; the net profit after non-exclusion was 31.6333 million yuan, a year-on-year increase of 56.61%.

The semi-annual report results released by Goertek showed that the listed company's revenue increased by 61.1% year-on-year to 13.576 billion yuan; net profit attributable to the parent increased by 17.7% year-on-year to 524 million yuan, exceeding market expectations; net profit after non-attributable to the parent increased by 56.7% year-on-year to 417 million yuan.

Brokerage analysts.It also said that as a leader in VR/AR, Goertek is currently at an inflection point of asset profitability recovery, and is optimistic about Goertek’s growth potential in the 5G era of smart wireless headsets, wearable devices, and VR/AR market demand.

In addition, the gaming industry has begun to accelerate growth. In the first half of the year, the growth rate of the mobile gaming industry reached 21.4%. As an important form of entertainment consumption, domestic demand for gaming is strong.

China Business News has learned that many securities firms have recently made clear their optimism about technology. For example, Xun Yugen of Haitong Strategy believes that the market will enter the second wave of bull market growth in the future, and technology and securities firms serving technology companies are expected to become the leading industry. Growth stocks represented by technology stocks will have a steeper profit recovery trend in the future.

It is worth mentioning that in addition to the positive trends in the industry in which the company is located, the adjustment of the value-added tax policy has also been beneficial to the performance of listed companies.

For example, Zhongshun Jierou (002511.SZ), the first A-share listed household paper company, had a comprehensive gross profit margin of 36.69% in the first half of the year and a single-quarter gross profit margin of 39.23% in the second quarter. The increase in gross profit margin is mainly due to the gradual decline in the company's pulp costs after the decline in pulp prices this year, as well as the adjustment of the value-added tax policy. Analysts predict that the improvement in gross profit margin is expected to continue in the second half of the year. It is worth mentioning that in the second quarter, net profit increased by 49.66% year-on-year, and net profit margin hit a record high of 9.28%.

No need to worry too much

Recently, the stock price of Kweichow Moutai (600519.SH) has hit record highs. The current stock price has reached 1,130.1 yuan per share. The semi-annual report shows that in the first half of 2019, it achieved total operating income of 41.173 billion yuan, a year-on-year increase of 16.8%; it achieved net profit attributable to the parent company of 19.951 billion yuan, a year-on-year increase of 26.56%.

“The performance of Kweichow Moutai on the one hand shows that consumption continues to strengthen as the economy improves, and it also reflects the institutional position preference.” A food and beverage analyst told China Business News.

In the early morning of August 24, FTSE Russell announced the quarterly adjustment results of its flagship index in September 2019. As scheduled, the inclusion factor of China A shares was increased from 5% to 15%. This year, due to the increase in the inclusion factor of FTSE Russell, the passive funds that will flow into A shares are approximately US$3.4 billion (24 billion yuan).

“It once again shows that China’s economy is still resilient, and both bonds and stocks have investment value. In the past year, the mainland stock connect has been seeing net inflows. Even in the face of trade frictions, foreign capital has continued to flow in. Foreign capital has not stopped flowing in because of these effects. In addition, domestic long-term funds are also slowly deploying.” A strategist from a securities firm in Shenzhen also said.

On Friday, the Tariff Commission of the State Council of China announced tariff countermeasures. Later, Trump tweeted that he would raise tariffs on goods worth $250 billion and $300 billion, and the trade situation became tense again.

Hua Changchun, a macro analyst at Guotai Junan, believes that the remaining US$300 billion in list tariffs will be borne more by the United States, mainly because it covers more industries with low substitution elasticity and low profit margins, and there is little room for Chinese manufacturers to continue to lower prices. In addition, the major categories of industries in the 300 billion and 250 billion lists overlap. Using the tariff burden of each major category in the 250 billion list to estimate the corresponding 300 billion list, the United States may bear 98% of the tariff costs in the 300 billion list.

“A-shares have experienced many such black swans in the past year. Everyone’s psychological construction has been almost done. It is possible that it will open lower and go higher.” The investment director of a private equity fund in South China analyzed.

On August 2, Trump stated that he would impose an additional 10% tariff on US$300 billion of goods imported from China starting from September 1 this year. On that day, the Shanghai Composite Index opened lower and fell 1.6%, and closed down 1.4%, which was smaller than the previous times.