Long and short factor game PVC is difficult to get out of the trend market in the short term

Judging from the recently released economic data, the world's major economies are facing downward pressure
.
The Fed's Beige Book shows that the U.
S.
economy grew in January and February, but half of the country was affected by a 35-day partial government shutdown, so the economy cooled in the first two months of 2019
.
Employment and inflation data also performed poorly
.
Data from the US Department of Labor showed that the US non-farm payrolls increased by 20,000 in February, significantly lower than expected and the previous value, hitting a 17-month low
.
The US unemployment rate was 3.
8% in February versus 3.
9% expected, and the data is still good, but there is not much
room for the unemployment rate to continue to decline.
The US CPI rose 1.
5% year-on-year in February, the smallest increase in two and a half years, and the PPI rose 1.
9% year-on-year in February, the lowest level
since June 2017.
Separately, the Eurozone manufacturing PMI came in at 49.
3 in February, a 68-month low
.
ECB President Mario Draghi said the near-term economic growth outlook is weaker than expected
.
The domestic economy is also weak, including the official manufacturing PMI in February continued to be below the boom-dry line, the import and export data fell sharply in February, and the growth rate of industrial added value and total retail sales of consumer goods continued to decline in January and February
.
The global economic downturn has weighed on
market confidence.

But against this backdrop of economic pressure, there has been a slight easing trend in global currency markets recently
.
The ECB said it expects to keep interest rates unchanged until at least the end of 2019 and announced the launch of a third round of targeted long-term refinancing in
September.
The Fed's dovish stance at its January meeting signaled the end of balance sheet reduction, and recent weak employment and dovish inflation data could further support the Fed's patience
with rate hikes.
As the Fed's dovish approach to monetary policy has also given the Chinese money market some room for easing
.
The shift in global monetary policy from neutral tightness to marginal easing may provide some boost to commodities
.

Fundamentals are mixed, with enhanced upstream cost support
.
At present, OPEC continues to promote production cuts, Venezuela's national oil company due to power outages caused by export disruptions, U.
S.
crude oil inventories unexpectedly reduced, coupled with the recent pressure on the US dollar have brought a positive boost to oil prices, it is expected that the short-term crude oil trend is strong, which will form a certain support for
chemicals.
Crude oil has continued its upward trend since the beginning of the year, and domestic calcium carbide prices have also continued to rise
slowly since mid-January.
Data show that as of March 13, the median price of calcium carbide arrival in East China was 3,350 yuan / ton, and the profit of calcium carbide production of PVC was about 316 yuan / ton, down about 434 yuan / ton
from mid-January.
Recently, due to the arrival of spring maintenance and environmental protection inspections in some areas, it is expected that the price of electropetrochemical will still rise
.
As costs continue to increase, profits are gradually compressed, and the production enthusiasm of PVC enterprises may be suppressed
to a certain extent.
In fact, Tianjin Dagu, Qingdao Haijing and other devices are undergoing maintenance recently, and Ningxia Jinyuyuan New Factory, Taizhou Liancheng and Yibin Tianyuan plan to start maintenance in mid-March or late March, so the probability of short-term PVC operating rate continuing to increase is relatively small
.

The cost side and supply side are favorable, and the pressure on PVC mainly comes from high inventory and weak downstream procurement enthusiasm
.
According to data, as of March 8, PVC upstream stocks were about 61,400 tons, although significantly lower than the high level after the Spring Festival, but still at the same high level
in the past three years.
Warehouses, traders and downstream inventories showed no clear signs of
digestion.
As of March 8, social inventory has increased by nearly 20% compared with after the Spring Festival, and strong inventory pressure has limited the upward
trend of PVC futures.
In terms of demand, although the downstream operating rate continues to increase, and with the arrival of the peak season, the downstream operating rate still has some room for
improvement.
However, in the face of high social inventory and uncertainty in the future market, the enthusiasm of factory procurement is still low, and it is mainly
necessary to purchase.
After the downstream demand is fully restored, if the inventory can be quickly digested, PVC may have a wave of upward movement, but at present, the digestion of inventory pressure remains to be seen
.

On the whole, the weak operation of the global economy has suppressed commodities, but in the context of downward pressure on the economy, the capital level has been relaxed, which may bring a certain boost
to the commodity market.
Fundamentals, PVC below is supported by the expectation of cost and demand improvement, and above it faces higher inventory pressure
.
The macro and fundamentals are intertwined, and it is expected that short-term PVC is still in a dilemma
.