摩根士丹利-宏观-关于中国刺激的主要问题回答 (2)

Investment Rating - The report suggests a potential for a further 10% tactical equity rally in the near term, indicating a positive investment outlook for the industry [2][5]. Core Insights - Policymakers in China are showing increased urgency in addressing deflation, with significant monetary easing and measures to stabilize the stock and property markets [2][4]. - A supplementary budget of Rmb1-2 trillion is expected to be announced, aimed at supporting consumption and local government financing, which is anticipated to improve quarterly growth from 3% in 2Q-3Q24 to 5% in 4Q24 [3][19]. - The report emphasizes that while recent policy moves are a step towards combating deflation, a return to sustainable growth will be a long and challenging process [4][26]. Summary by Sections Policy Expectations - A supplementary budget is expected to be approved by the NPC Standing Committee, likely in late October, focusing on consumption support and local government fiscal needs [8][7]. - Monetary easing is anticipated, including a policy rate cut of 20 basis points and a 25-50 basis points reduction in the reserve requirement ratio (RRR) [9][3]. Economic Growth Projections - Real GDP growth is forecasted to improve slightly from 3.6% in 3Q24 to 4.7% in 4Q24, with further acceleration to 5.3% in 1Q25 due to the easing measures [19][20]. - The report highlights that the deflation loop is deepening, necessitating more aggressive policy measures to stimulate demand and break the cycle [20][21]. Investment Positioning - The report recommends focusing on A-share companies with high excess dividend yields and free cash flows, as well as discounted dual-listed H-shares that may benefit from the People's Bank of China's measures [5][34]. - A tactical rally of approximately 10% for the CSI300 index is considered possible, contingent on macroeconomic improvements and corporate earnings recovery [41][40]. Long-term Outlook - The report indicates that a decisive exit from deflation will require substantial central government support for housing and social welfare, with a recommended stimulus size exceeding US$1 trillion over two years [17][28]. - The ongoing battle against deflation is characterized as both cyclical and structural, necessitating a shift in policy focus towards enhancing private consumption and addressing housing market challenges [27][26].