Agricultural modernization may become the layout focus of the 2016 Central Document No. 1

CNR News Beijing, December 25 - According to a report by Economic Voice's "Trading Live," the market expects that the 2016 Central“Document No. 1” will focus on agricultural modernization and rural e-commerce. How much hope of a bountiful harvest will the agriculture and rural sector bring to the capital market in the new year? In the WeChat Moments of "Trading Live," senior analysts and financial commentators discussed it heatedly:

Zhang Deliang, Chief Investment Advisor at Essence Securities: I think that among agricultural stocks, the opportunities brought by the prosperity cycle of agricultural products themselves are mainly in poultry and animal husbandry, among which the rise in prosperity of the poultry category is still very obvious.

Fu Shaoqi, Chief Analyst at Shanghai Securities: The market is focusing on rural e-commerce and agricultural modernization, and I think the direction of market expectations is correct. The maturation of the rural e-commerce market is gradually advancing, and the state is providing full support in industrial policy, finance, banking, talent, and various other aspects. The expectation for this industry's future development is relatively good. The medium- and long-term growth of some related leading concept stocks in rural e-commerce can be anticipated. In the short term, the Central Rural Economic Work Conference has a very obvious short-term triggering effect on these individual stocks. The upcoming “Document No. 1” in January next year will focus on agricultural reform, and rural e-commerce is also a very important direction. Land circulation is the most important direction of agricultural reform, and the market currently has relatively strong expectations for this as well. Under the short-term policy benefit effect and the medium- and long-term growth effect, the investment opportunities in some agricultural sub-sectors with relatively obvious policy benefits are still relatively good. In the short term, there may be some fluctuations after the “Document No. 1” is issued, but the medium- and long-term investment opportunities are still relatively obvious.

Gui Haoming of Shenwan Hongyuan Securities: For China, agriculture has always been a major issue affecting the national economy. Solving rural problems well, raising farmers' incomes, and promoting agricultural modernization are important foundations for China's economic development. At this rural work conference, everyone focused on further raising the level of agricultural modernization and improving rural e-commerce. I believe this move not only has an important impact on agricultural production, but also provides a new opportunity for the capital market. In the capital market, the proportion of agricultural stocks is not very high, but agricultural modernization indeed requires the support of the capital market, especially rural e-commerce and so on. The prospect of combining the internet with agricultural production is very broad, and quite a few listed companies have already entered agricultural fields such as smart agriculture. Driven by the rural work conference, around agricultural modernization, seeds, agricultural machinery, and water conservancy projects and other aspects will also present new development prospects, and corresponding listed companies will also have corresponding opportunities. Rural-themed stocks may have certain investment opportunities driven by the rural work conference, and corresponding varieties may also have indirect reactions in the short term.

Zhang Cuixia, Chief Investment Advisor at First Capital Securities: Related targets in agriculture, forestry, animal husbandry, and fishery should show effective attacking characteristics. At present, Guannong Co., Ltd. (600251) is in a standard process of consolidating at the bottom of a large cycle, and upward movement with fluctuations at this position is a high-probability event. Similarly, Yasheng Group (600108) is also in a very obvious process of strong consolidation. Today, both of the above targets showed strong bullish attacks, and once a platform breakout is formed, they should provide relatively good premium space. In addition, the target “Beidahuang” is also in the process of forming a double bottom over a large cycle, and the short- and medium-term moving averages are already in a bullish arrangement. From the current volume-price relationship and rebound expectations, the relevant sector stocks in agriculture, forestry, animal husbandry, and fishery are expected to deliver a relatively sharp attacking under the promotion of the central“Document No. 1” favorable policies. I suggest investors actively seize the trading opportunities in the relevant targets.