The A-share market surged and then pulled back on Friday (October 16), with the three major indexes closing mixed. The nonferrous metals sector stood out with active trading against the broader market trend. The nonferrous ETF Huabao (159876), which captures leaders across the nonferrous metals industry, saw its tracking index climb as much as 2.21% intraday before closing up 0.70%, outperforming the wider market.
It is worth noting that this index has already fallen back to its September level from last year, having retreated 38% from its historical high of 4282.17 set on January 29, 2026. At its current relatively low position, the valuation appeal is becoming more evident, and investors may want to watch for medium- to long-term allocation value following the correction.
Among constituent stocks, gold leaders Shandong Gold Mining Co., Ltd. (ASX: 600547) and Shanjin International led gains of more than 3%, while Srui New Materials and China Uranium also rose over 3%. Xingye Silver-Tin and Chifeng Gold advanced in tandem. Heavyweight stocks Zijin Mining and Aluminum Corporation of China each gained more than 1%.
On the news front, particular attention should be paid to the precious metals segment, which has seen active trading:
1. Precious metals prices have risen over the past two days. The COMEX gold front-month contract has rebounded more than $100 from its low of $4,095.0 per ounce, and as of publication, COMEX gold briefly climbed above $4,210 per ounce. Guosen Futures noted that the rapid decline in long-end interest rates was the direct driver of this round of gold and silver rebound. This rebound represents a technical recovery following consecutive CPI and PPI shocks, with falling U.S. Treasury yields providing a short-term valuation buffer. However, inflation resilience has not faded, and upward resistance for gold and silver remains strong*.
2. U.S. September PPI data came in broadly firm, but the market did not further raise its bets on an October hike, instead trimming expectations for a hike this month. The dollar index surged and then retreated, while the 10-year U.S. Treasury yield dropped sharply by 12.8 basis points to 5.062%. CITIC Futures believes that market expectations for further Fed rate hikes this year may cap gold's upside potential. However, September retail and core retail sales growth both slowed notably, and combined with previously weaker employment data, this is not yet sufficient to confirm that monetary policy will immediately tighten significantly and continuously. Central bank gold purchases, ETF allocation demand, and U.S. fiscal credit risk continue to provide long-term support for gold*.
3. Precious metals sector earnings are broadly improving. After the close on October 15, China National Gold Group Gold Jewellery Co., Ltd. released a pre-announcement for its first three quarters of 2026 results, expecting net profit attributable to shareholders of 5.52 billion yuan to 5.8 billion yuan, a year-on-year increase of 50.05% to 57.66%. The company's earnings growth was mainly attributed to significantly stronger profitability in its core products including gold and copper. Looking at operations in the first half of the year, the precious metals sector as a whole showed improving performance: Zijin Mining reported first-half net profit attributable to shareholders of 39.17 billion yuan, up 68.17% year-on-year; Shandong Gold Mining Co., Ltd. reported first-half net profit attributable to shareholders of 3.543 billion yuan, up 26.17% year-on-year; and both Chifeng Gold and Shanjin International posted year-on-year net profit growth of more than 50%. CITIC Securities believes that fundamentals are resisting the U.S. Treasury shock, and nonferrous metals are expected to bottom out.
Looking ahead for the nonferrous metals sector, a pattern of bottoming and then rebounding may emerge. The dip reflects a response to rising U.S. Treasury yields, while the recovery stems from investor attention to low valuations on the nonferrous equity side and the sector's own strong fundamentals. Currently, the PE ratios of nonferrous equities such as gold, copper, and aluminum are all at low levels. In gold, continuous capital inflows have effectively resisted pressure from the dollar and U.S. Treasuries, gold prices have stabilized, and capital is flowing back into gold stocks — gold stocks may start moving before bullion prices do. In base industrial metals, copper is benefiting from supply-side disruptions, with spot markets remaining tight and copper prices showing strength; aluminum is holding up well against long-term oversupply concerns thanks to low inventories, making its price highly resilient. The outlook for the nonferrous metals sector remains favorable.
*Huabao Fund stated that expectations for moderate Fed rate hikes remain unchanged, and it is optimistic about the medium- to long-term allocation value of nonferrous metals. Due to macroeconomic disruptions, the nonferrous sector has now fallen back to its September level from last year, offering relatively high allocation value. Combined with multiple advantages such as tight supply and demand and AI-driven demand, once the expected 10-year real interest rate peaks, nonferrous metals may see a right-side recovery. The strategy recommendation is to build positions in batches on dips and seize the sector's medium- to long-term allocation value.
The computing power era is built on nonferrous metals. Pay attention to the metal demand behind technological development. The nonferrous ETF Huabao (159876) and its feeder funds (Class A: 017140, Class C: 017141) comprehensively cover industry leaders in copper, aluminum, rare earths, gold, lithium, tungsten, molybdenum, tin, and other sectors. Its heavyweight holdings include Zijin Mining, China Molybdenum, China Northern Rare Earth, and Aluminum Corporation of China. The 2026 interim results showed that all 60 constituent stocks were profitable, with nearly half reporting year-on-year growth in net profit attributable to shareholders of more than 100%, providing solid support from strong fundamentals. In addition, the number of constituent stocks is significantly higher than comparable nonferrous indexes (30-50 stocks), allowing for better coverage of the semiconductor and new materials segments. For investors who are bullish on both technology and nonferrous metals, this ETF is an efficient tool to gain one-click exposure to the nonferrous metals industry and capture the sector's beta performance.
Source: Shanghai and Shenzhen stock exchanges, etc., as of October 16, 2026. *Institutional views reference sources: Guosen Futures' Commodity View published on October 16; CITIC Futures' Commodity View published in mid-October; CITIC Securities' Nonferrous Metals Industry: Fundamentals Resist U.S. Treasury Shock, Nonferrous Metals Expected to Bottom published on October 11. The fund manager assesses this fund's risk level as R3-Medium Risk, suitable for balanced (C3) and above investors. The suitability matching opinion should be based on the sales institution's assessment.
ETF fee explanation: When investors subscribe to or redeem fund shares, the subscription and redemption agency may charge a commission of no more than 0.5%. On-exchange trading fees are based on what the securities company actually charges. ETFs do not charge sales service fees. Feeder fund fee explanation: Huabao CSI Nonferrous Metals ETF Initiating Feeder Fund (Class A) has a subscription fee of 1,000 yuan per transaction for subscription amounts of 2 million yuan (inclusive) or more, 0.6% for 1 million yuan (inclusive) to 2 million yuan, and 1% for amounts below 1 million yuan; the redemption fee is 1.5% for holding periods of fewer than 7 days and 0% for holding periods of 7 days (inclusive) or more, with no sales service fee. Huabao CSI Nonferrous Metals ETF Initiating Feeder Fund (Class C) does not charge a subscription fee, has a redemption fee of 1.5% for holding periods of fewer than 7 days and 0% for holding periods of 7 days (inclusive) or more, and a sales service fee of 0.3%.
Risk warning: Nonferrous ETF Huabao passively tracks the CSI Nonferrous Metals Index, whose base date is December 31, 2013, and which was launched on July 13, 2015. The index's constituent stocks are adjusted from time to time in accordance with the index compilation rules, and its back-tested historical performance does not predict the index's future performance. Any information appearing in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, and any form of expression) is for reference only, and investors are responsible for any investment decisions they make independently. In addition, any views, analyses, and forecasts in this article do not constitute investment advice of any kind to readers, nor do they bear any responsibility for direct or indirect losses arising from the use of the content herein. Fund investment involves risk, past performance of a fund does not represent its future performance, and the performance of other funds managed by the fund manager does not constitute a guarantee of the fund's performance. Fund investment requires caution. A MACD golden cross signal has formed, and these stocks are performing well.
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