Textile And Clothing: Prices Of Raw Materials Continue To Fall &Nbsp; Neutral Rating

Investment points

Two week market review: textile and apparel keep steady during the reporting period Rise The trend of the region rose by 7.07%, far ahead of the Shanghai and Shenzhen 300 index's 2.60% rise. With the active theme stocks, the textile sector rose by 8.44%, the best in the sub sectors, and the clothing sector was also reported in fuanna and seven wolves. Stock increase Driven by an increase of 5.79%.

The main point of view in the next two weeks: the prices of raw materials such as cotton, polyester, viscose and other raw materials will continue to fall sharply. CPI has reached a new high of three years. The central bank has continued to tighten its liquidity. The pressure of funds for SMEs has become increasingly prominent. In addition, the actual growth of textile and garment exports is limited, and the trade outlook in the second half of this year is slowing down again, and the industry prospect is still uncertain. In view of the fact that the textile and garment industry has accumulated a large increase, there is a short-term pressure of callback, giving the industry a "neutral" rating. It is suggested that we should follow up the pre investment increase, underestimate the value and the investment logic of cost control. We should pay close attention to Lu Tai A (000726), Huafu color spinning (002042), fuanna (002327), Meng Jie home textiles (002397) and the wedding bird (002154).

Driving factor market performance:

1) the low PE stock market performance is better than 2) the short-term momentum effect is more obvious 3) the long term reversal effect is more obvious 4) the stock market with large market capitalization performs well 5.

1) 16 import taxes on textile commodities will be lowered in July 1st.

2) the tax threshold has been raised to 3500 yuan and effective since September 1st.

3) Central Bank: since July 7, 2011, the benchmark interest rate for one-year lending and lending of financial institutions has been raised by 0.25 percentage points.

4) CPI: three year high export: growth rate of four;

5) committing fear of Europe: cotton price. Plunge The second wave was 20% in two weeks.

6) GDP grew by 9.6% in the first half of the year, and the risk of "hard landing" was temporarily released.

7) the actual export volume growth is very limited.

8) the Ministry of Commerce: in the first half of the year, the sales volume of 3000 key retail enterprises increased by 21.6%.

9) the Ministry of Commerce: in the second half of the year, it still faces double pressures of rising cost concentration and external demand.