Shenwan Hongyuan Group Co., Ltd. has released a research report stating that recent geopolitical tensions in the Middle East, rising energy prices, stagflation concerns, and high asset volatility have collectively pressured the sector. Under the long-term driver of deglobalization, the investment logic for precious metals, bulk commodities, and strategic minor metals has entered a new paradigm. The nonferrous metals sector is expected to continue its upward trajectory, with short-term fluctuations presenting favorable allocation opportunities within the year. Key viewpoints from Shenwan Hongyuan are as follows:
Precious Metals: Financial Attributes Set to Shine Accelerated deglobalization is expected to sustain the trend of central bank gold purchases globally. Amid an interest rate cut cycle, capital is likely to continue flowing into gold ETF markets. Meanwhile, wealth effects are driving significant increases in private sector allocation demand. The golden era for gold persists, with silver offering potential for outsized gains. Companies to watch include Zijin Mining Group, Chifeng Jilong Gold Mining, Shandong Gold Mining, Zhaojin Mining Industry, Zhongjin Gold, Shandong Gold Group, Shengda Resources, and Zhuye Group.
Base Metals: Upward Trend Remains Intact In the aluminum sector, domestic production capacity is approaching its ceiling, while overseas supply growth remains limited. Rapid AI development has raised expectations of power shortages and production cuts abroad. Growth in new energy demand is offsetting declines in traditional sectors, supporting further improvement in aluminum market conditions. Companies to monitor include Aluminum Corporation of China, China Hongqiao Group, Tianshan Aluminum Group, Shenhuo Group, Yunnan Aluminium, Zhongfu Industrial, Nanshan Aluminum, and SuoTong Development.
For copper, supply disruptions persist. Beyond new energy applications, AI-related demand provides important marginal support. Post-interest rate cuts, demand recovery is expected to sustain a long-term bull market. Key companies include Zijin Mining Group, China Molybdenum, JCHX Mining, Sinomine Resource Group, Tongling Nonferrous Metals, Western Mining, and HBIS Resources.
Minor Metals: Positive Developments Emerge Against the backdrop of deglobalization, strategic minor metals such as rare earths, tungsten, and antimony continue to undergo value reassessment. High growth in energy storage demand has accelerated the reversal cycle for the lithium carbonate industry. Cobalt supply has contracted significantly, leading to a pronounced supply gap and continued price increases. Nickel prices are firmly supported by costs, with supply disruptions intensifying marginally. Companies worth attention include Dazhong Mining, Guocheng Mining, Shenzhen Chengxin Lithium Group, Huayou Cobalt, Tengyuan Cobalt, Hunan Gold, Huayu Mining, Yunnan Tin, and China Tungsten.
Risk factors include macroeconomic performance falling below expectations, easing of supply bottlenecks, and weaker-than-expected demand from sectors such as AI and energy storage.