Markets consolidated today (June 23), with major A-share indices closing in the red. The nonferrous metals sector led the market decline, and Huabao Nonferrous Metals ETF (159876), the largest ETF tracking its underlying index, followed the market lower. Its on-exchange price plunged 8.66%, with a robust daily turnover of 158 million yuan.
Undeterred by market volatility, capital moved in to buy the dip! Huabao Nonferrous Metals ETF (159876) recorded a net subscription inflow of 33.6 million units for the day, following a net capital inflow of 12.33 million yuan just yesterday.
Regarding constituent stocks, Zhuye Group led gains, rising over 4%. Grirem Advanced Materials gained more than 3%, and Yunnan Chihong Zinc & Germanium rose over 1%. Boway Alloy closed flat. The remaining 54 stocks all declined, with 17 stocks, including China Molybdenum, Jiangxi Copper, and Tongling Nonferrous Metals Group, hitting the daily downside limit, weighing on the index performance.
Why is capital actively positioning in the nonferrous metals sector? The reasons can be analyzed from both policy and industry perspectives.
First, on the policy front, two government departments have taken countermeasures. On June 22, the Ministry of Commerce announced the addition of 10 U.S. entities, including a U.S. rare earths company, to its export control list. The Ministry of Finance also issued a notice prohibiting the procurement of products from 46 U.S. companies in government purchasing activities. China possesses a complete rare earth industry chain from mining to separation and deep processing, controlling product pricing power. Guosheng Securities noted that the comprehensive upgrade of rare earth controls further highlights resource scarcity, and rare earth prices are expected to trend higher.
Second, on the industry front, supply-demand mismatch has ignited a price surge for "computing power metals." Industry consensus suggests the recent uptrend in minor metal prices this year is primarily driven by the combined effect of rigid supply constraints and expanding demand from emerging industries. In the short term, the global supply-demand situation has not fundamentally changed, with genuine downstream demand remaining strong. Prices are likely to remain relatively high in the foreseeable future.
Sinolink Securities pointed out that the nonferrous metals industry currently shows improvement on both supply and demand sides. Sectors like rare earths, molybdenum, and tin are experiencing accelerating or stable upward momentum, mainly benefiting from supply-side reforms and overseas restocking demand. Looking ahead, demand driven by new energy and AI for semiconductors will support prices of metals like tin and rare earths. Overseas geopolitical conflicts and increased military spending are driving inventory demand for strategic metals like tungsten and molybdenum. Improved supply-demand dynamics coupled with low inventory levels are expected to sustain the upward price trend.
Nonferrous Metals Sector Momentum Arrives; "Super Cycle" Appears Unstoppable
Huabao Nonferrous Metals ETF (159876) and its feeder funds (Class A: 017140, Class C: 017141) track an index comprehensively covering industries like copper, aluminum, gold, rare earths, lithium, tungsten, molybdenum, and tin. This broad coverage allows for better capture of the sector's beta. Additionally, this ETF is a margin trading and securities lending target, serving as an efficient tool for a one-click investment in the nonferrous metals sector.
As of the end of May, the latest size of Huabao Nonferrous Metals ETF (159876) exceeded 1.5 billion yuan, making it the largest ETF among the three products tracking the same underlying index in the market.
Investors should note that when subscribing for or redeeming fund units, subscription/redemption agents may charge a commission of up to 0.5%. On-exchange trading fees are subject to the rates charged by the securities company. The ETF does not charge a sales service fee.
For the feeder funds, the subscription fee rate for Huabao CSI Nonferrous Metals ETF Feeder Fund (Class A) is 1% for amounts below 1 million yuan, 0.6% for amounts between 1 million yuan (inclusive) and 2 million yuan, and a flat fee of 1,000 yuan per transaction for amounts of 2 million yuan (inclusive) and above. The redemption fee rate is 1.5% for holdings under 7 days and 0% for holdings of 7 days (inclusive) or more. No sales service fee is charged. Huabao CSI Nonferrous Metals ETF Feeder Fund (Class C) does not charge a subscription fee. The redemption fee rate is 1.5% for holdings under 7 days and 0% for holdings of 7 days (inclusive) or more. The sales service fee is 0.3%.
Risk Disclosure: Huabao Nonferrous Metals ETF passively tracks the CSI Nonferrous Metals Index. The base date for this index is December 31, 2013, and it was published on July 13, 2015. The index constituents are adjusted according to its compilation rules. Its backtested historical performance does not indicate future index performance. The index constituents mentioned herein are for illustrative purposes only. Individual stock descriptions are not investment advice in any form and do not represent the holdings or trading动向 of any fund managed by the manager. The fund manager assesses this fund's risk等级 as R3-Medium Risk, suitable for Balanced (C3) and above investors. Suitability matching opinions are subject to the销售机构. All information appearing in this article (including but not limited to individual stocks,评论, predictions, charts, indicators, theories, any form of表述, etc.) is for reference only. Investors are responsible for any independent investment decisions. Furthermore, any views, analyses, or forecasts herein do not constitute investment advice of any form to readers, nor is there any liability for direct or indirect losses arising from the use of this content. Fund investment involves risks. The past performance of a fund does not indicate its future performance. The performance of other funds managed by the fund manager does not guarantee the performance of this fund. Invest with caution in funds.
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